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HD 2358 
.5 

.U6 E54 
2007 
Copy 1 



Enhancing the Economic Potential of 
Asian Americans and Pacific Islanders (AAPI) 


A Report to the President 

from the 

President’s Advisory Commission on 
Asian Americans and Pacific Islanders 


May 7, 2007 


L4BHAR 




LC Control Number 



2007 406870 




































President's Advisory Commission on Asian American and Pacific islanders 


i 


Table of Contents 


Executive Summary.1 

Why Focus on the Economic Development of Asian Americans and Pacific Islanders (AAPIs)?.7 

Economic Development Strategies.20 

Community Development as an Economic Growth Strategy.27 

Barriers to AAPI Economic Growth Potential.35 

Findings and Recommendations.44 


Appendix A. 
Appendix B. 

Appendix C. 

Appendix D. 
Appendix E. 

Appendix F. 


Executive Order 13339 

Members of the President’s Advisory’ Commission on Asian Americans and 
Pacific Islanders 

Population Distribution and Sales per Firm by Ethnicity Status for Asian 
Americans and Pacific Islanders 

Sites Visited by the Commission 

List of Technical Assistance Conference and Outreach Activities Conducted by 
the AAPI Commissioners 

Chi-square Statistical Method Elaborated 


Appendix G. Calculations Used to Arrive at “Lost” Sales 

















































































































- 




















President's Advisory Commission on Asian American and Pacific Islanders 


Pase 1 


EXECUTIVE SUMMARY 


On May 13, 2004. President George W. Bush signed Executive Order 13339 (Appendix A) establishing the 
President's Advisory Commission (Appendix B) on Asian Americans and Pacific Islanders (AAPIs). AAPI 
communities include the following ethnic subgroups: Asian Indian. Chinese. Filipino. Japanese, Korean, 
Native Hawaiian and Pacific Islander. Vietnamese, and other Asian (see Appendix C for the population and 
sales per firm information for the AAPI subgroups). The purpose of the Commission is to advise the 
President with recommendations to provide “ equal economic opportunities for full participation of Asian 
American and Pacific Islander businesses in our free market economy where they may’ be underserved and 
thus improve the quality of life for Asian Americans and Pacific Islanders. 

The President recognizes that minority entrepreneurship is key to future economic growth in the United 
States, which is consistent with his emphasis on the need to create an “ownership society.” The President 
also recognizes, however, that when considering “minority entrepreneurship,” the role that AAPIs play and 
their potential to contribute has been largely overlooked. Under the Executive Order, this Commission has 
been asked to clarify better the potential benefits of stimulating AAPI economic development and identify 
actions to be taken to accomplish this. The Commission’s mission is to review 7 the current economic 
participation of the A API-owned businesses in our free market economy and recommend ways and means 
to enhance the economic potential of AAPIs resulting in the improvement of their quality of life. 

Beginning in July 2004. the Commission conducted a series of site visits, technical assistance conferences, 
and follow-up meetings in cities across the United States (see Appendices D and E for specific cities). The 
purpose of these interactions w as two-fold: first, to connect AAPIs from these cities directly with resources 
and representatives from federal, state, and community 7 organizations that play a role in economic 
development and second, to hear about their successes, challenges, and suggestions for more effective 
support. The Commission met with representatives from various federal departments and agencies about 
their programs and initiatives targeted at AAPI economic and community development. We also 
considered research conducted by various agencies, institutions and individuals. 

Identifying Major Issues 

Under the Executive Order, the Commission focused on assessing four main issues: 

1. Why focus on economic development for the AAPI community 7 ? 

2. Do current federal policies and perceptions limit or inhibit growth among AAPI entrepreneurs 
and businesses? 

3. What can help “unlock” the economic potential of AAPIs? 

4. What role can community development and other local (e.g., faith-based) organizations play in 
fostering AAPI economic growth? 


1 Excerpt from Executive Order 13339. 




President's Advisory Commission on Asian American and Pacific Islanders 


Pace 2 


Key Findings 

The Commission's findings are focused around three major themes: 

AAPIs: Potential Economic Engine 

AAPIs can make significant contributions to the United States economy over the next decade as 
they are the fastest growing population segment, increasing by an estimated 48 percent - from 12.5 
million in 2004 2 to 18.5 million by 2020. 3 AAPIs are also perceived to be among the most 
entrepreneurial of the minority groups, with current per capita business ownership comparable to 
that of the non-minority population. 4 

Despite the potential, AAPI entrepreneurship currently lags behind non-minority businesses in 
several key business indicators (see Table 6 for details). It also lags behind other minority-owned 
businesses in employees per business and business contractions (see Tables 5 and 6 for details). 
These facts indicate a large gap, implying that the average AAPI entrepreneur is more focused on 
“sustenance” businesses versus innovative, growth-oriented businesses. AAPI firms received 8 
percent of the contracts (in dollar amount) awarded through the network of funded centers of the 
Minority Business Development Agency (MBDA) in fiscal year 2005, while they represent nearly 
13.5 percent of the minority population. 5 Thus, on a population basis, it appears that there is 
additional economic potential if AAPIs are more successfully reached when offered support and 
assistance and/or if they take advantage of assistance that is available. As the MBDA states in 
August 2006 The State of Minority Business Fact Sheets: “The Asian business landscape in 2002 
would have been quite different if parity had been achieved. Parity is defined as reaching 
proportionality between the adult Asian population and business development measures such as 
numbers of firms, gross receipts and employees....Under a parity scenario, paid employment would 
have totaled almost 2.5 million - 268,000 more than the actual number.” For Native Hawaiians and 
other Pacific Islanders, the gross receipts and paid employment figures would have been at least 
five times the actual. 6 7 Closing these gaps to expand the entrepreneurial capacity of AAPIs will 
likely have tremendous benefits for the economy and for the opportunities and quality of life of 
AAPIs. 

Census data from 2002 show that the average sales and receipts for an AAPI-owned business is 
$292,213, while it is $415,974 for White-owned businesses. A simplistic calculation indicates that 
taking current AAPI-owned businesses up to White-owned business performance levels would have 
delivered $140 billion in additional receipts that year (refer to Appendix G for calculation details). 

To develop Tocqueville’s America, one needs to encourage and sustain the “greater involvement of 
Americans in governing themselves, their relatively broad education and their wider equality of 
opportunity [to] encourage the emergence of the ‘man of action’ with the ‘skill’ to ‘grasp the 
chance of the moment.”’ 8 The enabling of the “man of action” with the right “skills” to “grasp the 
chance of the moment” is a critical task for the federal government. We define the “man of action” 
with the right “skills” as the entrepreneur who can assess an idea in the business environment and 
take actions to realize that opportunity. 


2 U.S. Census Bureau, 2004 American Community Survey. 

J Population Projections Program, Population Division, U.S. Census Bureau, Washington, D.C. 

4 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001, p. 5. 

5 MinorityBiz Fast Facts 2006. U.S. Department of Commerce Minority Business Development Agency & U.S. Census Bureau 
News, Nation’s Population One-Third Minority, May 10 2006. 

6 MinorityBiz Fast Facts 2006, U.S. Department of Commerce Minority Business Development Agency. 

7 Company Summary: 2002. 2002 Economic Census, Survey of Business Owners, Company Statistics Series, U.S. Census Bureau. 

8 Edmund S. Phelps, Wall Street Journal, Feb 12, 2007, A15. 




President's Advisory Commission on Asian American and Pacific islanders 


Pace 3 


This thought is also emphasized by Nobel Laureate Edmund Phelps: “The dynamism that the 
economic model possesses is in turn a crucial determinant of the country’s economic performance: 
Where there is more entrepreneurial activity—and thus more motivation, as well as all the financial 
and managerial activity it leads to—there are more jobs to fill, and those added jobs are relatively 
engaging and fulfilling. Participation rises accordingly and productivity climbs to a higher path.” 9 
Thus, the emphasis on entrepreneurial development must be sustained for the AAPIs. As shown 
later, developing a significant number of these entrepreneurs into “high potential” or 
“opportunistic” entrepreneurs w ill have even greater impact on the U.S. economy and society'. 


Developing Opportunistic Entrepreneurs is Key to Growth 

An analysis of the employee data from the 2002 Census (Table 6) reveals that AAPI-owned 
businesses are smaller than White-owned businesses. These numbers suggest that while there are a 
relatively large number of AAPIowned businesses, these businesses tend to be smaller companies 
with fewer employees - an indication that AAPIs are more focused on “sustenance” type ventures. 
To close the gaps identified between performance of AAPI-owned and White-owned businesses, 
AAPIs should be encouraged to be more “opportunistic” entrepreneurs allowing them to explore 
and create businesses that grow well beyond the consumer-oriented businesses AAPIs tend to own. 

Opportunistic Entrepreneurs (OEs) are a critical component of the United States economy since 
they represent businesses that grow' beyond sustenance. Characteristics of OEs include developing 
and promoting new products, technologies and innovations; targeting customers and markets 
outside the local community; and, in most cases, using outside financing. The result of successful 
OE-led businesses is significantly larger receipts and number of employees per company - and 
much larger contributions to the economy. Compared to the average entrepreneur, high-potential 
entrepreneurs will typically employ 20 people in 5 years, show continued growth in receipts, are 
younger, know more entrepreneurs, and are better able to recognize and find business opportunities 
through better market analysis. 10 First, we need to instill among AAPIs that America is the “land of 
opportunity,” and cultivate conditions that will enable the rise and proliferation of high potential 
entrepreneurs in our communities. Reports of several AAPIs returning to their countries of origin is 
a disturbing trend. 1112 

High-potential or Opportunistic Entrepreneurs are the backbone of U.S. competitiveness. These 
entrepreneurs create the businesses that transformed a static, sluggish economy into a fast-growing 
and dynamic one, resulting in a doubling of the productivity in the last two decades. 1 ' Even though 
we know that OEs tend to spot growth opportunities and develop that new knowledge into high 
potential innovations leading to rapid economic growth, we do not understand the process 
undertaken by these “stars” to achieve their phenomenal successes. A concerted effort must be 
made, through the implementation of a research program, to systematically follow AAPI OEs (and 
other AAPI entrepreneurs) to unlock and codify the secrets of these successes. 


9 Edmund S. Phelps. Wall Street Journal, Feb 12, 2007,p. A15. 

10 Erlend Bullvaag. Zoltan J. Acs, I. Elaine Allen, William D. Bygrave and Stepehen Spinelli, Jr. Global Entrepreneurship Monitor 
Report, 2004-2005. 

11 Ronald Alsop, Wall Street Journal, March 13, 2007, p. B9. 

12 India Today International. March 5. 2007, p. 21. 

13 Erlend Bullvaag, Zoltan J. Acs, I. Elaine Allen, William D. Bygrave and Stepehen Spinelli, Jr. Global Entrepreneurship Monitor 
Report, 2004-2005. 




President's Advisory Commission on Asian American and Pacific islanders 


Page 4 


The “Invisible Minority”-Overcoming Obstacles to Opportunistic Entrepreneurship 

The key challenges to developing more OEs within the AAPI community can be summarized in 
two parts. First, it is widely perceived that A APIs are not a “disadvantaged” or “under-represented” 
minority group and, therefore, do not need targeted assistance. Second. AAPIs are not aware, do 
not seek out, or do not take advantage of what assistance is available to them. Often referred to as 
“the Model Minority,” our findings suggest that AAPIs have more accurately become “the Invisible 
Minority” - neither viewed as under-represented nor large and unified enough to have a clear voice 
- in terms of having programs, resources and support available to them, particularly those centered 
around fostering opportunistic entrepreneurship. The reality is that, based on 2000 Census data, 
AAPIs (3.7%) constitute less than a third of either the African American (12.3%) or the Hispanic 
American populations (12.5%). 14 AAPIs are also far from being homogeneous; waves of 
immigrants over the past thirty-plus years have introduced dozens of disparate languages and 
cultures, and many of these ethnic groups are in fact less educated, less assimilated, and experience 
the highest poverty levels in the country (for example, over 22 percent of the Cambodian, Laotian 
and Hmong community are reportedly living in poverty). 1 ^ Among those who indicated Asian as 
their only race, 11.8 percent lived in poverty in 2003, up from 10.1 percent in 2002. The overall 
number living in poverty also rose, from 1.2 million to 1.4 million. For the population that reported 
Asian descent, regardless of whether they also reported another race, the rate and the number 
increased to 11.8 percent and 1.5 million. 16 

The federal government has made great progress in creating and reinforcing programs aimed at 
encouraging business growth among Hispanic American, African American, and Native American 
minorities with some outstanding results (see Table 2 and Figure 3). Figure 3 indicates that since 
1987, the business ownership index - the ratio of business ownership to share of population - for 
AAPIs has remained essentially constant at around 1.18, while this rate has increased for the 
aforementioned ethnic groups. It is important to study what caused the business growth for other 
ethnic groups and why AAPIs did not benefit in similar manner. By this measure alone, there is 
reasonable evidence that there is an opportunity to help AAPIs enhance their economic potential. 

PRIMARY RECOMMENDATIONS 

Based on the Commission’s findings, we have developed five primary and three secondary 

recommendations to the President that we believe will enhance the economic potential of AAPIs resulting 

in the improvement of their quality of life. 

The five primary recommendations are: 

1. Increase data collection and reporting on AAPI economic and business activity 

The Commission found that data on AAPI-owned business performance and supporting programs 
was often over-aggregated, out-dated, or simply lacking. Data to accurately represent current AAPI 
business activity must be collected to measure and periodically report the impact of initiatives and 
programs on AAPI entrepreneurial performance. 

In addition, the government needs to collect and/or make resources available for the collection of 
economic data that is disaggregated by AAPI subgroups, not just AAPIs as a whole. The data from 
U.S. Census Bureau can be more specific in ethnicity, source of income, and other key statistics. 
Research grants and other funding should be made available for research and data collection on 


14 Population Profile of the United States: 2000 (Internet Release). U.S. Census Bureau. 

15 Le, C.N. 2007. "Socioeconomic Statistics & Demographics" Asian-Nation: The Landscape of Asian America. <http://www.asian- 
nation.org/demographics.shtml>. 

16 Income Stable, Poverty Up, Numbers of Americans With and Without Health Insurance Rise, U.S. Census Bureau Reports, 
August 26, 2004. 




President's Advisory Commission on Asian American and Pacific Islanders 


Paee 5 


AAPI economic and community development. The Commission identified a crucial need for 
expanded data collection to more fully understand differences among AAPI subgroups and AAPI 
entrepreneurs, focusing on characteristics such as demographics and. the entrepreneur's background 
and differences spanning generations within AAPI communities. A White House task force could 
facilitate this AAPI-specific data identification and collection process. 

2. Make federal economic development programs more widely available to AAPIs 

Government agencies (federal, state, and local) need to increase AAPI outreach efforts of current 
programs available to other minorities. Some of these programs may also need to be designed with 
AAPI-specific support including outreach, language assistance and other cultural counseling to 
ensure that AAPIs are able to access programs and succeed in obtaining a “fair share” of the 
benefits. 

3. Fund and create new programs to encourage greater AAPI participation 

In situations where AAPI-specific programs do not exist, government agencies need to create 
and/or tailor outreach and support efforts to increase AAPI access to these programs. 

4. Establish a Strategic Working Group of representatives from key federal agencies to 
coordinate and implement recommendations related to AAPI-owned business growth 

Currently, there is no oversight of AAPI-based economic initiatives. Some agencies (e.g., 
Department of Commerce, Small Business Administration (SB A), Department of Treasury', General 
Services Administration, Social Security Administration, Department of Transportation, and 
Department of Defense) play a key role in creating and supporting programs that foster AAPI 
entrepreneurship and should be part of this recommended Strategic Working Group. A key mandate 
of this group should be to outline and implement initiatives aimed at increasing outreach, data 
collection and economic analysis of AAPI-owned businesses. The Commission also recommends 
that this Working Group conduct further research on hidden barriers that AAPIs face in try ing to 
work with the federal government. Implementing initiatives to improve outreach and support is yet 
another mandate recommended. 

5. Establish a Task Force to implement the recommendations 

In addition to supporting an on-going Strategic Working Group, the Commission believes 
establishing a task force to initiate and follow through the implementation of the recommendations 
contained in this report and the 2003 AAPI Commission on Health and Disparities reports 1 is 
critically important. Such a task force can ensure that the work outlined in these reports is managed 
and addressed by the Executive Branch and the Congress. 

SECONDARY RECOMMENDATIONS 

In addition to the primary recommendations listed above, the Commission’s findings reveal several other 
important initiatives it proposes to enhance the economic development of AAPIs. 

1. Build capability to offer counseling and mentoring on entrepreneurship and business 
development issues within community-based organizations 

Although community-based organizations historically have been more focused on securing funding 
for housing, health care, child care and other social assistance programs, evidence from numerous 
studies supports the encouragement of entrepreneurship as a means to generate greater economic 
wealth in the community. Training, through local resources and partnerships (e.g., SBA’s SCORE 
program), can pay huge dividends in helping AAPIs to not only reach or overcome subsistence 
levels but also to encourage and develop more OEs. The Commission recommends that a federal 


17 Asian Americans and Pacific Islanders Addressing Health Disparities - Opportunities For Building A Healthier America. 2003, 
<http://ww\v.health.gov/communication/db/report_detail.asp?ID=160&page=9&search_tvpe=all&sp=6>. 




President's Advisory Commission on Asian American and Pacific islanders 


Pace 6 


agency, such as SBA, facilitate entrepreneurship counseling and mentoring programs targeted to 
AAPIs. 

2. Foster greater collaboration among various AAPI-oriented organizations 

Given the scarce - and declining - resources available to qualified community-based and faith- 
based organizations, successful communities have found ways to effectively collaborate across 
organizations to secure funding, build critical mass for larger-scale projects, and provide more 
extensive training and support of entrepreneurship and business development. Currently, there is 
no forum to share these success stories. The Commission recommends that a component of the 
Strategic Working Group of key federal agencies suggested in this report also be directed to 
coordinate development of programs that foster greater collaboration among the various AAPI 
organizations that are currently serving their respective communities. 

3. Encourage the establishment of a National Chamber of Commerce for AAPIs 

A national chamber will foster the interaction, sharing of experiences and contacts, and highlight 
the increasing economic relevance of various regions in global trade and business. Accordingly, we 
recommend the establishment of a National Chamber of Commerce for AAPIs. 



President’s Advisory Commission on Asian American mid Pacific Islanders 


Page 7 


WHY FOCUS ON ECONOMIC DEVELOPMENT FOR THE AAPI COMMUNITY? 

AAPIs represent a potential ‘'economic engine" that can make significant contributions to the United States 
economy over the next decade. AAPIs are expected to be the fastest growing population segment, 
increasing by an estimated 48 percent - from 12.5 million to 18.5 million - by 2020, and comprising nearly 
9 percent of the U.S. population by 2050 18 (see Figure 1). AAPIs are also perceived to be among the most 
entrepreneurial of the minority groups, with the number of businesses owned per capita comparable to that 
of the non-minority population. 19 


10 % 
9% -I 
8 % 
7% 
6% 
5% 
4% 
3% 
2% j 
1 % 
0 % 


Figure 1. Projected AAPI Population as 

18 


Percent of U.S. Population, 2002- 2050 







2000 2010 2020 2030 

Decade 


2040 


2050 


Despite clear potential, AAPI entrepreneurship 
currently lags far behind non-minority 
businesses in several key areas. Receipts per 
business, employees per business, and business 
contractions, for example, indicate a large gap, 
implying on one hand that the average AAPI 
entrepreneur is more focused on “sustenance" 
businesses versus innovative, growth-oriented 
businesses. AAPIs receive fewer government 
contracts and assisted financing, in dollar 
terms, than other minorities - AAPIs received 
8 percent of the contracts and fewer than 10 of 
the financings obtained through the Minority 
Business Development Agency - suggesting 
that AAPIs are not offered similar support and 
assistance and/or do not take advantage of what 
assistance is available. 


AAPIS ARE THE 

FASTEST GROWING U.S. POPULATION SEGMENT * 

• Today, there are more than 15 million Americans 
of Asian or Native Hawaiian or Pacific Islander 
heritage, or approximately 4 percent of the U.S. 
population. 

• Within just 4 years, between 2000 and 2004, the 
population of Asian Americans increased by 16.2 
percent, and the Native Hawaiian and Pacific 
Islander population grew by 7.7 percent. 

• This population is estimated to continue growing, 
often at rates higher than any other group. The 
Census Bureau estimates that by 2020, the AAPI 
population will reach 18.5 million, and by 2050, it 
will reach 35.8 million (approximately 9 percent of 
the population). 


* Source: www.census.gov 


Closing these gaps to expand the 
entrepreneurial capacity of AAPIs - that is, 
finding ways to encourage and support more 

AAPI Opportunistic Entrepreneurship - will benefit the economy and improve the opportunities and quality 
of life of AAPIs. A simple calculation (Appendix G) indicates that taking receipts of current AAPI-owned 


18 2000 data from U.S. Census Bureau: Population Profile of the United States: 2000 (Internet Release), & 2006-2050 from. 
National Population Projections Program, U.S. Census Bureau. 

19 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001 , p. 5. 













President's Advisory Commission on Asian American and Pacific islanders 


Pace X 


businesses up to White-owned business levels would have garnered nearly $140 billion in additional 
receipts in 2002. The resulting new business growth and contributions could create even greater economic 
value as the AAPI population expands in the coming decade. 

Industrious...Ambitious...Entrepreneurial...Well-Educated...Successful: “Model Minority” characteristics 
like these are commonly applied to AAPIs. Why, therefore, would anyone be concerned with improving 
the economic situation and well-being for this particular group? We believe the reason is clear. 

For the United States to maximize economic growth and remain competitive, it is imperative that the 
country’s large and rapidly growing minority population be able to achieve its economic potential and 
successfully and fully assimilate into the national economy. 

According to a recent study sponsored by the Ewing Marion Kauffman Foundation, an organization 
renowned for its study of global entrepreneurial activity, “the same global dynamics that are changing the 
face of business in general - from the outsourcing of manufacturing and services to new trends in ‘supply- 
chain’ management - make change necessary for minority businesses.” For the U.S. to remain competitive, 
its growing minority businesses must be able to improve their economic capabilities and “grow beyond 

on 

current performance plateaus.” 

The opportunity and potential to increase the economic performance of the AAPI population is large and 
ripe for development. It is a community that is uniquely endowed with strong entrepreneurial foundations 
and drive. Investing in the economic development potential for this community can result in significant 
gains for the country. We believe that the untapped economic potential of the AAPI community, if 
unleashed, could spur a major boost to the national economy. 

If the current performance of AAPI-owned businesses continues, the incremental economic contribution 
would have been in excess of $142 billion (in 2002 dollars) in annual receipts by 2020. Conversely, 
continuing to ignore or overlook problems and barriers that AAPI-owned businesses, AAPI entrepreneurs, 
and AAPI communities face will result in potential national economic and social costs. 

The potential-current success and strong characteristics can be leveraged to expand 

U.S. ECONOMIC PERFORMANCE 

At first glance, both economic data and widely-held perceptions would seem to indicate that AAPI-owned 
businesses are prolific, generating disproportionate revenue, growing rapidly and, therefore, not seemingly 
disadvantaged or underrepresented. The Commission’s view, however, is that the economic potential of the 
AAPI community is still not fully realized. Rather, the strong entrepreneurial inclinations of AAPIs and 
their track record of successful business start-ups suggest that with targeted programs and expanded 
outreach assistance, AAPIs can make even greater economic contributions to the U.S. economy. Following 
are a few of the key attributes of the AAPI community that make it particularly attractive as a target for 
economic development. 


20 Ewing Marion Kaufman Foundation: The New Agenda for Minority Business Development, 2005. 

21 2002 AAPI-owned business receipts were approximately $331 billion: 44% growth would yield an additional $142.3 billion. 




President's Advisory Commission on Asian American and Pacific Islanders 


Page 9 


AAPI-Owned Firms are Engines of Economic Growth - With Considerable Upside 
According to the U.S. Census Bureau Survey of Business Owners (see Table 1 on following page), AAPI- 
owned businesses are successful and growing, both in terms of the number of firms and revenue generated. 
As of 2002, there were 1.1 million Asian-owned firms, comprising almost five percent of all U.S. firms 
(4.93 percent)." 4 AAPI-owned firms, collectively, had sales and receipts of approximately $331 
billion and employed almost 2.24 million paid workers. 25 


The census data show that the number of AAPI-owned businesses has grown significantly during the past 
several years. From 1997 to 2002, the numbers of Asian-owned firms grew by 24 percent' 0 or more than 
double the 10.3 percent growth rate for all U.S. firms 27 over the same period. The number of Hawaiian and 
Pacific Islander firms grew 49.4 percent"' or more than four times the national average. Yet despite this 
growth, Asian-owned businesses lagged the respective growth rates of African American- and Hispanic - 
owned businesses. Had the number of Asian-owned businesses achieved the same growth rate as African 
American-owned businesses (45 percent), there would have been approximately 1.3 million Asian-owned 
firms. Likewise, had the revenue growth of Asian-owned businesses achieved that of African American- 
owned businesses (24 percent), Asian-owned businesses would have generated nearly $377 million in 2002 
or $50 million more than actual. By either measure, while AAPI-owned businesses have been strong 
contributors to the U.S. economy, there is considerable upside potential for even greater contributions with 
targeted economic development 

Table 1. Firms and Receipts 1997-2002 29 30 31 32 33 



2002 

1997 

% change from 1997 - 2002 


# of Firms 

Sales & Receipts 
in (1000) 

# of Firms 

Sales &Receipts 
in (1000) 

# of Firms 

Sales & 
Receipts 

Asian-owned 

1,103,587 

$326,663,445 

893,590 

$302,795,000 

24% 

8°o 

Pacific Islander- 

owned 

28.948 

4,279,591 

19,370 

4,138,000 

49% 

3% 

African American- 
owned 

1,197,567 

88,641,608 

823,499 

71,215,000 

45% 

24% 

Hispanic-owned 

1,573,464 

221,927,425 

1.199.896 

186,275,000 

31% 

19% 

U.S. TOTAL 

22,974,655 

22.603.658.904 

20.821.935 

18.553,243,047 

10.3% 

21.8% 

White-owned and 
Others 

19,071,089 

22,183.852,369 

17,885.580 

18.246,052,557 

6.6% 

21.6% 


AAPI Business Ownership Exceeds Share of Population 

Another key attribute that highlights the entrepreneurial capability of the AAPI community is the continued 
growth of the number of AAPI-owned businesses which has kept pace with the steady growth of the overall 
AAPI population for more than two decades (see Figure 2). 


22 Company Summary: 2002,2002 Economic Census, Survey of Business Owners, Company Statistics Series, & 1997 Economic 
Census Minority- and Women-Owned Businesses United States U.S. Census Bureau. 

23 Asian Owned Firms 2002,2002 Economic Census, Survey of Business Owners, Company Statistics Series & U.S. Census 
Bureau News, Growth of Native Hawaiian- and Other Pacific Islander-Owned Businesses Over Three Times the National 
Average, June 28,2006, U.S. Census Bureau. 

24 Native Hawaiian and Other pacific Islander Owned Firms 2002,2002 Economic Census, Survey of Business Owners, Company 
Statistics Series, U.S. Census Bureau. 

25 PI data: Ibid ; AA data: Asian Owned Firms 2002,2002 Economic Census, Survey of Business Owners, Company Statistics 
Series, U.S. Census Bureau. 

26 2002 Survey of Business Owners, U.S. Census Bureau. 

27 U.S. Census Bureau News, Growth of Native Hawaiian- and Other Pacific Islander-Owned Businesses Over Three Times the 
National Average, June 28,2006, U.S. Census Bureau. 

28 2002 Survey of Business Owners, U.S. Census Bureau. 

29 Ibid. 

30 Ibid. 

31 1997 Economic Census Minority- and Women-Owned Businesses United States U.S. Census Bureau. 

32 2002 Survey of Business Owners, U.S. Census Bureau. 

33 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001, p. 5. 





















President's Advisory Commission on Asian American and Pacific Islanders 


Page 10 


This data is even more revealing when viewed as the ratio of business ownership share to population share, 
referred as the “Business Ownership Index.” 34 Over the period from 1982 to 2002, AAPIs are the only 
minority group-other than American Indian and Alaska Natives in just the past two census reports - for 
which the ratio of business share to population share exceeds 1.0 (see Table 2 and Figure 3 on following 
page). In fact, these data illustrate that AAPIs are the only minority group that has achieved some form of 
“parity” in the Business Ownership Index relative to Non-Minority-owned businesses over the 1982-2002 
time horizon suggesting that AAPIs have enjoyed a bit of successful entrepreneurial activity. 


Figure 2. Percent Share of Population and Business Ownership for AAPIs 


32 



□ AAPI Population 

□ AAPI Business 


Achieving parity with Non-Minority-owned businesses in the Business Ownership Index masks, however, 
the lack of growth of this index among AAPI-owned businesses relative to other minority groups, 
particularly from 1987 to 2002. Over that time period, the Business Ownership Index has grown at a much 
greater rate for Hispanic-owned (16 percent), African American-owned (65 percent) and American Indian 
and Alaska Native-owned (678 percent) than Asian-owned (-5 percent) businesses. Even Non-Minority- 
owned businesses grew 3 percent during this period. 

One interpretation of this data might suggest that Asian-owned businesses have achieved “maturity” (parity 
with Non-Minority businesses), and therefore should be viewed as needing little targeted support. A 
different interpretation, however, would suggest that other minorities have benefited from targeted support, 
and similar efforts might translate to growth in the Business Ownership Index for AAPIs. This latter 
interpretation is supported by the Commission. 


34 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001, p. 5. 
























































President’s Advisory 1 Commission on Asian American and Pacific Islanders 


Page 11 


Table 2. AAPI Share 


of Population and Business Ownership has Risen over Time' 



1982 

1987 

1992 

1997 

2002 

Share of Population (Percent) 

Non-Minority Population 

78.90 

76.91 

74.77 

72.70 

68.00 

Minority- Population 

21.10 

23.09 

25.23 

27.30 

32.00 

African American 

11.59 

11.70 

11.90 

12.07 

12.08 

American Indian and Alaska 
Native 

0.61 

0.68 

0.73 

0.74 

0.56 

Asian American and Pacific 
Islander 

1.89 

2.47 

3.06 

3.53 

4.21 

Hispanic 

7.01 

8.23 

9.55 

10.97 

13.77 

Share of Business Ow nership (Percent) 

Non-Minority-Owned 

93.16 

90.68 

87.54 

84.88 

83.01 

Minority-Owned 

6.84 

9.32 

12.46 

15.12 

16.99 

African American-Owned 

2.56 

3.10 

3.60 

4.24 

5.21 

American Indian and Alaska 
Native-Owned 

0.14 

0.18 

0.59 

1.02 

0.876 

Asian American and Pacific 
Islander-Owned 

2.00 

3.03 

3.50 

4.26 

4.93 

Hispanic-Owned 

2.35 

3.58 

5.00 

6.08 

6.85 

Business Ownership Index: Business Ownership/Popu 

ation 

Non-Minority-Owned 

1.18 

1.18 

1.17 

1.17 

1.22 

Minority-Owned 

0.32 

0.40 

0.49 

0.55 

0.53 

African American-Owned 

0.22 

0.26 

0.30 

0.35 

0.43 

American Indian and Alaska 
Native-Owned 

0.23 

0.26 

0.81 

1.38 

1.56 

Asian American and Pacific 
Islander-Owned 

1.06 

1.23 

1.14 

1.21 

1.17 

Hispanic-Owned 

0.34 

0.43 

0.52 

0.55 

0.50 


Figure 3. Business Ownership Indices for 
Different Ethnic Groups, 1982-2002 ' 


1.60 


x 

0 ) 

T3 

C 


- 1.20 


i/i 

01 

c 

5 

O 

I/I 

</> 

O) 

c 

<7i 

3 

m 


0.80 


0.40 


0.00 



■Non-Minority-Owned 


Minority-Owned 


■African American-Owned 


“♦♦“American Indian and Alaska 
Native-Owned 

•^^■■Asian American and Pacific 
Islander-Owned 
Hi spani c-Owned 


35 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001, p. 5. 











































































President's Advisory Commission on Asian American and Pacific Islanders 


Page 12 


A A PI Women Entrepreneurs Exceed their Share of the Population 

Business ownership of AAPI women exceeds their share in the population. Between 1997 and 2004, the 
number of Asian and Pacific Islander women-owned firms increased by 69 percent, employment grew by 
73 percent, and sales rose by 83 percent. 36 

As of 2004, there are an estimated 419,793 majority-owned, privately-held firms owned by Asian American 
and Pacific Islander women in the U.S., employing about 544,000 people and generating $69.7 billion in 
sales. On a national basis, 8.5 percent of Asian and Pacific Islander women were entrepreneurs as of 2002. 
More than 1 in 12 adult AAPI women chose to own a business, compared to one in 18 of all adult women in 
the U.S. 37 

AAPI-Owned Businesses Have Strong Survival Rates and Expansion Rates 

Between 1997 and 2001, A API-owned businesses demonstrated survival rates - 72.1 percent-that are 
stronger than all other minority firms and only slightly below that of non-minority-owned firms at 72.6 
percent. During this period, AAPI-owned firms also showed stronger than average expansion rates (see 
Table 3). AAPI-owned firms expanded at rates above the national average and only lagged behind the 
expansion rate of Hispanic-owned firms. 

Table 3. Survival and Expansion Rates between 1997 - 2001 38 



Survival Rate 

Expansion Rate 

All U.S. Establishments 

69.8 

30.3 

African American-owned 

61.0 

25.7 

AAPI-owned 

72.1 

32.1 

American Indian & Native Alaskan-owned 

67.0 

27.8 

Hispanic-owned 

68.6 

34 


AAPI-Owned Firms are Significant Employers 

In 1997, only 26 percent of non-minority-owned firms and 20 percent of minority-owned firms had paid 
employees. Of the minority-owned firms, AAPIs employed over 2.2 million employees, controlling almost 
48 percent of total minority business payroll and employing 49 percent of minority business employment. 
Nearly one-third of Asian-owned businesses had paid employees, compared to only 11 percent of African 
American-owned firms and 18 percent of Hispanic-owned firms. This is particularly significant given the 
fact that AAPI-owned firms are still fewer in number than the number of Hispanic-owned or African 
American-owned firms. 

Table 4. Composition of Minority-Owned Firms, Employment \991 39 


Firm Ownership 

Share of Employer 
Firms in Total Firms 

Share (Percent) 



Firms 

Employer Firms 

Employment 

Payroll 

Non-Minority-owned 

26 

85 

88 

96 

97 

All Minority-owned 

20 

15 

12 

4 

3 







African American-owned 

11 

27 

15 

16 

15 

AAPI-owned 

32 

30 

47 

49 

48 

American Indian & Alaska Native-owned 

17 

6 

5 

7 

7 

Hispanic-owned 

18 

39 

34 

31 

31 


36 Center for Women’s Business Research. April 2005. 

37 Calculated by the National Women’s Business Council using data from the U.S. Census Bureau and the CWBR, April, 2005. 

<http://www.nwbc.gov/ResearchPublications/documents/Asian_american_Factsheet_2006.pdf>. 

38 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001. 

39 Ibid. 





























President s Advisors Commission on Asian American and Pacific Islanders 


Page 13 


AAPI Immigration: A Source of Economic Growth and Urban Renewal 

AAPIs share certain cultural values that lay the foundation for economic accomplishment. Many AAPIs 
share a propensity to work hard, maintain an entrepreneurial spirit, aspire to achieve self-sufficiency, and 
remain committed to education. These values appear particularly strong among AAPI immigrants and 
refugees. 


In 2005 nearly 70 percent of AAPIs were first-generation immigrants and/or refugees. 40 Throughout their 
history of immigration, self-employment has been 


a prominent mode of work for many AAPIs. 
Entrepreneurship is often a source of economic 
empowerment for these first-generation AAPIs and 
their communities, as well as a provider of jobs and 
a generator of economic activity. Many AAPI 
immigrants, such as Asian Indians, come to the 
United States already possessing high levels of 
education and skills. 


The employment rate of Vietnamese refugees in 
1975 was 68.2 percent among men and 50.9 percent 
among women. Within three years, 94.9 percent of 
all first-wave Vietnamese refugees over the age of 
16 were employed, as compared to 94.5 percent of 
all Americans. 

Asian Americans Impact on Business and Education, 
www. asianamericatis. com'businessimpact. htm 


Many of the successes of the AAPI community, from AAPI consumer power to the number of AAPI 
college graduates to the number of AAPI-owned small businesses and the impact of the AAPI community - 
based organizations and advocacy groups, can be attributed to the strength, hard work, and 
accomplishments of first-generation AAPI immigrants. 


Another economic stimulus that AAPI 
immigrants have brought to this country is 
the creation and proliferation of Asian 
ethnic enclaves, such as Little Tokyo 
(Nihonmachi), Little Saigon, Korea Town, 
Filipino Town, and Chinatown. These 
enclaves, found in or near major 
metropolitan cities with a critical mass of 
AAPIs, have helped spark new business 
and job opportunities in these communities 
and beyond. According to Dr. Michael 
Porter of the Harvard Business School, 


“Chinatown in Flushing is home to a vibrant middle class and 
blue-collar community, and is wealthier than Chinatown in 
Manhattan. Until the 1970s, Flushing was mostly an Italian 
and Greek neighborhood, but the downtown was shaken by the 
economic turmoil of the 1970s. People left Flushing and 
housing prices dropped. Korean and Chinese immigrants 
began to settle in Flushing by the late 1970s. and have 
predominated since the 1980s.” 

John Roeke, Flushing Chinatow n in Queens New■ York, A 
Neighborhood Tour 

http ://queens.about.com / cs/neighborhoods a tour_flushing.htm 


“There is a direct correlation between 

immigrant populations and job growth in inner cities. Immigrants clearly and more readily identify the 
unique business conditions and opportunities that inner cities offer and are able to capitalize upon them.” 41 


AAPI immigrants, especially those who are limited-English proficient tend to settle in these ethnic 
enclaves. The continuous influx of AAPI immigrants into these areas infuses vitality and investments into 
these communities and spurs economic growth and community’ renewal. 


Grow ing Number of AAPI Leaders and Role Models 

A recent and significantly important development in the AAPI community- has been the grow ing number of 
AAPIs in leadership roles in America. The elevation of AAPIs to the upper echelons of American society', 
whether in business, government, the arts, science, or philanthropy, sets up important advocates and role 
models for the AAPI community. The current Administration has appointed a larger number of AAPIs to 
senior positions than previous administrations. 


40 Promising Practice Brief. Vol 17(1), Center on Disability Studies (CDS). University of Hawaii at Manoa. 

41 “Immigrants Fueling Job Growth in U.S. Inner Cities, Study Finds.’’ Initiative for a Competitive Inner City, November 15. 2005. 







President's Advisoiv Commission on A si mi American and Pacific Islanders 


Page 14 


The AAPI community has a solid foundation for economic success. As the population and number of 
AAPI-owned businesses continue to grow, it becomes increasingly important that this segment of the 
American economy is able to maximize its potential. The potential to expand the economic capabilities of 
the AAPI community is large, especially when it is revealed that there are significant areas where AAPI 
economic performance can be enhanced. We believe that there is still a lot of room to grow, and that there 
is a good foundation from which to build. 

The Opportunity-bridge the performance gap 

On the surface, AAPI-owned businesses appear strong, but deeper analysis reveals that these businesses 
actually lag in certain key areas that are significant to long-term economic growth (e.g., high contraction 
rates and smaller firm size). While AAPIs start businesses at a higher rate and own businesses with 
stronger survival rates than the national norm, these businesses actually remain at the lower end of the 
spectrum in terms of receipts, assets and profitability. As emphasized in the Kaufmann Report, 42 it is 
important for the U.S. to help minority firms grow beyond current performance plateaus. 

“Encouraging minorities to start new businesses will still be a priority. But a second and equally important 
objective is to ensure that existing minority businesses are taking the necessary steps to achieve substantive 
growth,” said Carl J. Schramm, President and CEO of the Kauffman Foundation, upon releasing the study 
on June 28, 2005. “This issue has never been more relevant or important than it is today.” 43 

AAPI-Owned Firms Lag Behind in Size and Economic Contributions 

As noted earlier, many AAPIs start businesses and run them successfully. The start-up and survival rates 
for these businesses are comparable to or exceed those of White-owned firms. However, AAPI-owned 
firms still lag behind White-owned firms in their size and economic contributions (see Table 6). The 
average receipts per firm for White-owned firms were $415,974 in 2002. 44 For Asian American-owned 
firms with paid employees, the average receipts per firm were $296,001 - less than three-fourths of the 
White-owned average receipts. Companies owned by Native Hawaiians and Pacific Islanders (NHPI) 
averaged only $147,851 per firm (see Figure 4). For the aggregated AAPI-owned category, firms averaged 
$292,214 per firm in receipts. 

Figure 4. Receipts per Firm for Minority Groups and Whites, in dollars 44 



African Hispanic Asian NHPI White 

American 


42 Ewing Marion Kaufman Foundation: The New Agenda for Minority Business Development, 2005. 

43 Ibid, p. 1. 

44 Company Summary: 2002,2002 Economic Census, Survey of Business Owners, Company Statistics Series, U.S. Census Bureau. 




















President's Advisory Commission on Asian American mid Pacific Islanders 


Paae 15 


Not only is the amount of receipts per firm lower for AAPI-owned companies, growth in receipts is below 
that of other minority-owned firms and the national average. From 1997 to 2002, the receipts of Asian- 
owned firms grew only 7.8 percent versus 22 percent growth of U.S. firms. 4 ' The 7.8 percent growth in 
AAPI-owned receipts also lagged behind other minority-owned firms: Hispanic-owned companies grew at 
19 percent and African American-owned firms grew at 25 percent over the same period (see Figures 4 and 

5). 


Figure 5. Percent Growth in Firms & Receipts for 
Minority Groups, Whites and the U.S., between 1997-2002 45 



□ % Firms 
■ % Receipts 


AAPI-Owned Firms Have Higher Contraction Rates 

While AAPI-owned firms had one of the highest growth rates for the number of new firms and had 
expansion rates above non-minority'-owned firms, they also demonstrated higher risks of decline than all 
other firms. According to the Small Business Administration, AAPI-owned firms had the highest 
contraction rate of all minority -owned firms (see Table 5). 


Table 5. Expansion and Contraction Rates, in percent, 
for Non-Minority-Owned and Minority-Owned Firms 46 



Expansion Rate, 
1997-2001 

Contraction Rate, 
1997-2001 

Non-minoritv-owned 

27.4 

21.1 

Asian American and Pacific Islander-owned 

32.1 

22.9 

American Indian and Alaska Native-ow ned 

27.8 

22.4 

African American-owned 

25.7 

19.9 

Hispanic-owned 

34.0 

17.8 


Employment for AAPI-Owned Firms Falls Short of the National Average. 

Between 1997 and 2002, AAPI-owned firms grew at rates that were more than double that of the national 
average and they employed significantly more people than other minority-owned firms. However, it 
appears these firms struggle to retain employees and increase receipts per employee. Compared to the 


45 U.S. Department of Commerce [MB DA] (2006), The State of Minority Business Enterprises: An Overview of the 2002 Survey of 

Business Owners , p. 9. 

For 1997 data: <http:/Avww.census.gov/epcd/mwb97/us/us.html>. 

For 2002 data: <http://www.census.gov/prod/ec02/sb0200cscosumLpdf>. 

46 Small Business Administration, Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001, p. 9. 

<http://www.sba.gov/advo/research/rs251 tot.pdf>. 























































































President's Advisory Commission on Asian American and Pacific Islanders 


Page 16 


national average, AAPI-owned companies employed fewer employees per firm, had lower receipts per 
employee, paid employees less, and had lower receipts per pay (see Table 6). 

Table 6. Summary Data for Firms with Paid Employee(s), 2002 4 



Employees/Firm 

Receipts/Employee 

Payroll/Employee (‘000) 

Receipts/Payroll 

U.S. Total 

20.05 

$197.00 

$34.40 

5.73 

White-owned 

11.03 

$146.32 

$29.67 

4.93 

AAPI-owned 

6.94 

$131.40 

$25.35 

5.18 

Asian American-owned 

6.93 

$131.50 

$25.31 

5.20 

African American-owned 

7.98 

$87.30 

$23.28 

3.75 

Hispanic American-owned 

7.70 

$116.80 

$23.89 

4.89 


Between 1997 and 2001, AAPI-owned firms had the largest job losses of all other minority-owned losses in 
non-classified establishments due to closure; 56 percent of AAPI-owned establishments lost employees. 
AAPI job loss rates were higher than the average U.S. figures. AAPI-owned firms tied with African 
American-owned firms for the largest employment losses due to contraction: 17 percent. 48 During this 
same period, AAPI-owned firms had 49 percent of total minority business employment. 

Clearly, a problem exists when the minority group that employs the most people also has some of the most 
significant problems retaining those jobs or adding real economic value per employee. 


AAPI Leadership in Mainstream America is Below 

Economic growth is driven by both opportunity 
and influence. AAPI leadership in mainstream 
America may be on the rise, but AAPI 
influence and representation still lags behind in 
many key areas. 

For example, a study by the Committee of 100 
found that AAPIs are underrepresented on 
corporate boards. Only 1 percent of Fortune 
500 companies have AAPI directors, although 
AAPIs make up 5 percent of the population. 49 
The Committee of 100 also found that AAPIs 
are exceptionally underrepresented in the top 
tiers of academia. AAPIs are the most 
educated ethnic group in America and AAPI 
students are well-represented on college 
campuses (6.4 percent of students), but only 
2.4 percent of the positions of President, 

Provost, or Chancellor at major universities are 
held by AAPIs. 50 This is important from an 


That of Other Minority Groups 

According to Kom/Ferry International, the number of Fortune 
1000 firms with at least one Asian or Asian American 
corporate director between 1995 and 2002 has lagged behind 
the number of firms with at least one corporate director who is 
Hispanic/Latino, African American, an ethnic minority overall, 
or a woman, respectively. In 2002, 79% of Fortune 1000 
corporate boards had at least one female corporate director, 

71% had at least one ethnic minority corporate director overall, 
44% had at least one African American corporate director, 17% 
had at least one Hispanic/Latino corporate director, and only 
10% had at least one AAPI or Asian corporate director. 

In 2002, 60 out of 5,912 Fortune 500 corporate director seats 
were held by AAPIs or Asians— 1% of the total number of 
Fortune 500 corporate directors. 

In 2003, 60 out of 5,875 Fortune 500 corporate director seats 
were held by AAPIs or Asians — again, 1% of the total number 
of Fortune 500 corporate directors. 


Committee of 100: Asian Pacific American Corporate Board Report Card 


47 U.S. Census Bureau (2006), 2002 Economic Census, Survey of Business Owners: Asian Owned Firms:2002. 

For Asian-Owned firms: http://www.census.gov/prod/ec02/sb0200csasiant.pdf; 

For African American-Owned firms: http://www.census.gov/prod/ec02/sb0200csblk.pdf; 

For Hispanic-Owned firms: http://www.census.gov/prod/ec02/sb0200cshisp.pdf; 

For White-Owned firms: http://www.census.gov/prod/ec02/sb0200cscosumt.pdf, and 
For Hispanic-Owned firms: http://www.census.gov/prod/ec02/sb0200cshispt.pdf 

48 SBA Office of Advocacy, Dynamics of Minority-Owned Employer Establishments, 1997-2001, Table 11. 

49 Committee of 100 (2004), Asian Pacific American Corporate Board Report Card 

http://www.committeel00.org/initiatives/corporate_board/2004.04.23%20Formal%20Report.pdf. 

50 Committee of 100 (2005), Asian Pacific American in Higher Education Report Card 

http://www.committee 1 OO.org/publications/edu/C 100_Higher_Ed_Report_Card.pdf. 
















President's Advisory Commission on Asian American and Pacific Islanders 


Page ! 7 


economic development point of view because lack of representation means lack of access. Corporate 
boards and academic circles are often places where access to important resources and networking can be 
found that can help entrepreneurs grow their businesses. 

Politically, AAPI groups are also underrepresented. A Current Population Survey reveals that voter 
registration rates for the Asian American population are the lowest of all ethnic groups. Bringing Asian 
American registration rates to those of whites would have added almost 700.000 votes in the 2004 
elections.' 1 

The Bush Administration has made significant strides in elevating AAPIs to the top tiers of government, 
appointing, for the first time in history, two Asian Americans to Cabinet-level positions and appointing the 
highest number of AAPIs to key positions within the federal government. However. AAPI representation in 
government is still behind that of African Americans and Hispanics. In Congress, there have been a total of 
only 15 AAPI voting members. Currently, there are only seven members of the House of Representatives 
and two Senators of AAPI descent. 5 ’ AAPIs do not have Congressional representation that is proportionate 
to their share of the national population. 

Economic benefits to the u.s. of developing aapi economic potential 

While it may be impossible to know the precise amount of what the economic potential of AAPI firms 
might be, it is clear that the payoff in tapping this potential could be 
immense. 

A “back of the envelope” calculation can illustrate the economic 
potential of AAPI businesses (see Appendix G). If the 1.1 million 
Asian American-owned firms had receipts comparable to non¬ 
minority-owned firms in 2002, they would have generated an 
additional $132 billion in receipts. If the 29,000 firms ow ned by 
Native Hawaiians and Pacific Islanders were of comparable size, they 
would have generated an additional $8 billion in receipts. Taken 
together, if AAPI-owned firms were comparable to non-minority- 
owned firms, they could have contributed an additional $140 billion in receipts to the economy, supporting 
an untold number of new jobs. 

Other specific benefits that could result by helping AAPI-owned business grow to scale include the 
following: 

• Increased U.S. trade and international competitiveness: As the global economy dominates the 
national business landscape, Asian Americans’ understanding of both Asian and American culture 
and language has become a tremendous asset for corporate America and the American economy.' 4 
AAPI entrepreneurs and professionals are playing important roles to open markets and foster 
partnerships between Asia and the United States. A number of AAPI entrepreneurs and 
professionals are already doing business or helping to establish more business with their countries 
of origin. This activity helps promote U.S. trade overseas and spurs U.S. economic growth. 

• Enhanced economic opportunities for the nation and the AAPI community through the creation of 
wealth and high-paying jobs. 


In 2002, AAPI owned 
businesses would have 
contributed over S140 billion 
in additional receipts and 
numerous jobs to the U.S. 
economy if they had 
performed on par with White- 
owned businesses. 


51 Passel, Jeffrey S. Latino and Asian Voters in the 2004 Election and Beyond, Migration Information Source, November 2004. 

52 http://en.wikipedia.org/wiki/List_of_Asian_Pacific_Americans_in_the_United_States_Congress. 

53 Dean Statement on the Midterm Elections, November 14, 2006. <http://www.democrats.Org/a/2006/l l/dean_statement_29.php>. 

54 Raymund Flandez, Wall Street Journal, March 20, 2007, p. B6. 




President's Advisory Commission on Asian American and Pacific islanders 


Page 18 


• The building of increased capacity and capability of AAPI-owned businesses: Larger firms can 
better utilize state-of-the-art technology allowing them to improve productivity. 

• The opportunity for larger AAPI-owned firms to become global players in a global economy: Size 
makes it easier for firms to succeed in a rapidly changing global environment. 

• Increased opportunities for collaboration with other businesses and mentorship from business 
leaders. 

• Enrichment of talent and skills in American society and corporations through the development of 
new leaders within the AAPI community. 

The benefit for unlocking AAPI economic potential is significant. It is, therefore, worth the investment to 
support AAPI communities in their efforts to assimilate new generations of immigrants, to encourage high- 
growth businesses, and to support AAPI entrepreneurs in their efforts to expand their companies to scale. 

THE COST OF ‘BUSINESS AS USUAL’ AND IGNORNING AAPI ECONOMIC DEVELOPMENT 

While economic performance of AAPIs has been respectable; growth continues to fall behind the national 
average as already stated. If economic growth continues to be constrained or limited, especially for new 
immigrants, it will result in deep social and economic consequences for the AAPI community on the whole 
and, in turn, for the United States. 

Past Progress Will Be Lost 

One of the key points of the Kauffman Foundation’s study on Minority Business Development is that the 
“impressive gains made by minority-owned businesses over the past few years stand to be squandered 
unless new growth strategies are adapted to compete in a rapidly changing business market.” 55 

“Past models are no longer sufficient to ensure an expanded role for minority entrepreneurs in the U.S. free- 
enterprise system,” states James Lowry, a senior vice president of the Boston Consulting Group and the 
report’s author. “A collaborative effort among corporations, government, foundations, major universities, 
and minority entrepreneurs is required to ensure these businesses grow beyond current performance 
plateaus.” 56 

Growing Dependence on Public Support bv Immigrant Populations 

As noted earlier, the population growth of the AAPI community is expected to increase from 4 percent of 
the U.S. population to nearly 9 percent by 2050." 7 The majority of this growth is expected to come from 
new immigration. 

Immigration can either be an enormous economic asset or a drain on society. The history and experience of 
AAPI immigration proves that these immigrants come to the United States primarily in search of the 
American dream - attainment of self-sufficiency, wealth, and freedom. Immigrants are searching for ways 
to support themselves and their families, but if opportunities are limited or inaccessible or significant 
barriers exist, immigrants may be left with little choice but to rely on public support. 

Already, the immigrant experience is fraught with the challenges of simply surviving and adjusting to a new 
place with foreign systems, laws, language, and culture. These challenges compound the difficulties that 
entrepreneurs face in starting, running, and growing businesses. 


55 Ewing Marion Kauffman Foundation release, June 28. 2005. 

56 Ibid. 

57 National Population Projections Program. U.S. Census Bureau. 






President's Advisory Commission on Asian American and Pacific islanders 


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For the U.S. to make the trend of immigration a boon to the economy versus a growing cost to society, the 
increasing number of immigrants must be able to successfully settle and readily access America's 
opportunities and support to economically prosper. 

Challenges to U.S. Competitiveness 

Ignoring AAPI economic potential not only impacts new immigrants but it also has implications for all 
Americans. AAPI immigrants are creating new U.S. firms at rates above the national average (see Table 1). 
These new firms are helping to create new employment and business advantages for all Americans. If they 
are constrained from reaching and maintaining growth, however, employment opportunities could be lost 
resulting in a drain of American skilled labor seeking opportunity beyond U.S. shores. 

America’s competitive edge today is in its skilled workforce. However, increased globalization and 
competitiveness are already making retention and attraction of a skilled w orkforce a struggle for U.S. 
businesses. America must maximize the growth and competitiveness of its homegrown businesses in order 
to fully reap the talent it invested in attracting and developing them. 

Already, several U.S. business segments, especially the fast-growing technology sector, have opened 
significant operations overseas to access the skilled workers they need in order to be competitive. Not only 
are U.S. businesses locating operations overseas but their employees have also follow ed those jobs. The 
trend of U.S. businesses and talent finding more lucrative opportunities outside the U.S. will be exacerbated 
if the economic potential that exists in the U.S. continues to go under-developed.' 8 ' 9 60 

Currently, many Asian countries rank among the fastest grow ing economies of the world - countries where 
millions of Asian Americans originated. As stated in articles published in the Wall Street Journal and India 
Today International , people are returning to their countries of origin to do business in these regions. It is 
only logical to capture these synergies for U.S. economic growth and thus enhance the economic potential 
of AAPIs. 


58 Ronald Alsop, Wall Street Journal, March 13, 2007. p. B9. 

59 India Today International. March 5, 2007. p. 21. 

60 Raymund Flandez, Wall Street Journal. March 20, 2007. p. B6. 





President's Advisory Commission on Asian American and Pacific islanders 


Page 20 


ECONOMIC DEVELOPMENT STRATEGIES 


The Commission recognizes that there is no “one-size-fits-all” remedy to speed economic development for 
the AAPI community as a single entity. AAPIs are the most diverse ethnic group in the U.S. encompassing 
50 ethnic subgroups and 100 languages. 61 While this diversity can be an asset and adds to the richness of 
the Asian American and Pacific Islander cultures and their contributions, it can present many challenges for 
policymakers. 

We have narrowed our focus to two economic development strategies that we believe are critical to 
unleashing the economic potential of Asian American and Pacific Islander-owned businesses: 

1) Diversification of AAPI-owned businesses; and 

2) Creation and development of AAPI Opportunistic Entrepreneurs. 

DIVERSIFY AAPI-OWNED FIRMS AND GROWTH STRATEGIES 

One of the most significant factors that limit the economic potential of AAPI-owned businesses is that these 
businesses are concentrated in no-growth or low-growth businesses. These businesses also have limited 
market reach. AAPI entrepreneurs face all of the challenges that any small business would face and more. 
In a significantly more acute way, AAPI entrepreneurs lack the knowledge and background in the American 
market economy that would allow them to fully comprehend potential business opportunities and their 
probability for success or failure. 

As a result, recent immigrants, in particular, tend to cluster around well-known “formula” businesses with 
which they are familiar: restaurants or food vending services, nail salons, convenience stores, and other 
retail or “mom and pop” type of neighborhood establishments. In 2002, retail and wholesale trade 
accounted for 47 percent of Asian-owned business receipts. Asian-owned firms also had a high 
concentration in “other services,” such as personal services, repair and maintenance, and professional, 
scientific, and technical services. Native Hawaiian and Other Pacific Islander-owned businesses appear to 
be concentrated in health care and social assistance, “other” services, retail, waste management, and 
construction (see Table 7). 

Highlights from the Southern California Minority Business Survey 

• A notably large number of Korean American-owned businesses are retail companies (44 percent) and an 
equally large share is in the services sector (44 percent). Ninety percent of the businesses are sole 
proprietorships, 56 percent have fewer than 5 employees, and 26 percent earned revenues between 
$101,000 and $1 million. 

• Sixty-four percent of Vietnamese businesses are in the service sector, with a concentration in personal 
services (16 percent), health services (16 percent), and repair services (11 percent). Thirty-five percent of 
businesses in the retail sector were restaurant/fast food companies. 

• Almost one-half of Vietnamese-American firms (49 percent) report that more than 75 percent of their 
business comes from the ethnic consumer market. 

Source: The Southern California Minority Business Atlas 


61 President’s Advisory Commission on Asian Americans and Pacific Islanders, A People Looking Forward: Action for Access and 
Partnerships in the 21st Century, Interim Report to the President and the Nation, (Jan. 2001), p. 7. 

62 U.S. Census Bureau News, Revenues for Asian-Chvned Firms Surpass $326 Billion, Number of Businesses Up 24 Percent, May 
16, 2006. 







President's Advisory Commission on Asian American and Pacific Islanders 


Page 21 


Table 7, AAPI Firms by Industry 63 


Industry 

U.S. Firms 

Asian American- 
Owned Firms 

NHPI—Native Hawaiian and 
Pacific Islander-owned Firms 

All 

22,974,655 

1,103,587 

28,948 

Agriculture 

249,290 

6,261 

540 

Mining 

102,029 

456 

103 

Utilities 

18,896 

225 

1 

Construction 

2,780,323 

38,787 

2,853 

Manufacturing 

601,181 

23,719 

324 

Wholesale trade 

711,083 

46,564 

377 

Retail trade 

2,584,689 

151,616 

3,601 

Transportation 

976,826 

52,056 

1,412 

Information 

309,117 

12,092 

311 

Finance and insurance 

901,368 

30,041 

579 

Real estate 

2,146,154 

74,620 

1,851 

Professional, scientific, technical services 

3,280,627 

154,220 

3,239 

Management 

28,351 

478 

3 

Waste management 

1,568,045 

53,028 

3,362 

Educational services 

409,724 

15,517 

442 

Health care and social assistance 

2,021,115 

123,208 

— 

Arts, entertainment, and recreation 

969,741 

26,534 

1,678 

Hospitality 

676,116 

104,993 

511 

Other services 

2,677,613 

188,701 

— 

Unclassified 

29,593 

1,201 

— 


Unfortunately, these areas of business concentration are also the areas with the lowest growth potential. 
Until AAPI businesses are able to diversify or expand into industries with higher growth rates, their 
economic potential and opportunity will continue to be limited. 

Identify and Diversify into High-Growth Industries 

Minority-owned firms can expand the most rapidly if they take the opportunity to select their future 
business ventures based on the prospects for those industries in the U.S. and global economies. Strategic 
options for a firm’s progress can be formulated based on the growth prospects for particular sectors and the 
presence, or absence, of minority-owned businesses in that sector. 04 


Table 8. Growth rates, in percent, for manufacturing and 
Non Manufacturing (products and services) Sectors 64 


Approximate growth rates for selected 
Manufacturing sub sectors 


Approximate growth rates for selected Non 
Manufacturing and Services sub sectors 

Information Technology 

12 


Computer and data processing services 

19 

Health-drug-medical & dental equipment 

5 


Securities and trading companies 

15 

Instruments 

3 


Management consulting and public relations 

13 

Chemicals and Plastics 

2 


Accounting, Auditing and book keeping 

9 

Construction Materials 

2 


Telecommunications 

8 

Food and Kindred products 

2 


Advertising Services 

\6~ 


63 U.S. Census Bureau (2006), Survey of Business Owners 2002 <http://factfmder.census.gov/servlet/IBQTable?_bm=y&- 
geoid=D&-ds_name =SB0200A1 &-_lang=en>. 

64 Forfuither discussion of this model, see Boston Consulting Group, The New Agenda for Minority Business Development, June 
2005, sponsored by the Ewing Marion Kauffman Foundation, p. 25. 











































President's Advisory Commission on Asian American and Pacific islanders 


Page 22 


In manufacturing, information technology products and services, business services and support services for 
personnel, are expected to show strong growth rates. In addition, health, drug, and medical and dental 
equipment manufacturing are expected to grow more rapidly than other manufacturing sectors - see the 
accompanying story about Tanox, Inc. for further illustration. 

Tanox, Inc. 

One example of a firm in a high-growth area is Tanox, Inc. Started by Dr. Nancy T. Chang in the late 1980s, Tanox 
scientists discovered a novel approach for the treatment of allergic disease by reducing the levels of immunoglobulin 
E in the blood. 

In June 2003, an anti-IgE therapy, Xolair® received approval from the U.S. Food and Drug Administration for the 
treatment of asthma. Tanox continues to research and develop therapeutic monoclonal antibodies designed to address 
significant unmet needs in the areas of asthma, allergy, inflammation, and other diseases affecting the human immune 
system, including HIV. 

On June 23, 2005, Tanox’s CEO, Dr. Chang, rang the opening bell for NASDAQ in celebration of the fifth 
anniversary of Tanox’s listing on the Exchange. 

While Dr. Chang’s choice of industry may have been prescient, it does not explain all of her success. She is driven and 
views any weakness as an opportunity to obtain additional training and guidance in order to make herself and her team 
even stronger. She grows her management team internally, and all of her executives benefit from language, 
communications and leadership training. She delights in finding what people do best and advancing them within the 
company, mentoring them to bring out their best efforts. But, first and foremost, she is a scientist, with a dream of 
making the new drugs that will cure suffering. 


In non-manufacturing products and services, several of the more rapidly-growing sectors are computer and 
data processing services, securities and trading companies, and management consulting and public relations, 
all of which are projected to experience double-digit growth. Accounting, auditing and bookkeeping, 
telecommunications, and advertising are also strong sectors (see Table 8). 

For the Kaufman Foundation study on minority-owned business development, the Boston Consulting Group 
(BCG) formulated a matrix to indicate where potential growth opportunities for minority-owned firms 
might lie. BCG indicates that an industry with high sector growth and low growth among minority-owned 
businesses warrants aggressive pursuit of opportunity. In portions of the sector where minority-owned 
businesses might be underrepresented, a strong partner could help a minority-owned firm enhance 
capabilities and capture advantage quickly. This is indicated by the upper left quadrant of the chart located 
on the following page. 

Conversely, industries in which minority business growth has been significant and business growth overall 
is low should be avoided. This is indicated by the lower right quadrant of the chart located on the following 
page. 

Diversify the Customer Base -- Marketing Beyond the Local Community 

Certainly, one aspect of growing a company to a larger scale rests in developing the ability of AAPI firms 
to market beyond their local communities. Many AAPI firms begin their life cycle in ethnic neighborhoods 
serving members of their own community. 

To grow, the firm must begin the process of assimilation by learning to market and provide goods and 
services to consumers in the mainstream economy. This has become one of the most difficult areas for 
AAPI entrepreneurs. The Minority Business Atlas 6 ' calls this the most overwhelming business assistance 


65 


The Southern California Minority Business Atlas. The Community Development Technologies Center and the Merrill Lynch 
Foundation, 2000. 





President's Advisory Commission on Asian American and Pacific Islanders 


Page 23 


need among minority businesses; 30 percent 00 of the businesses surveyed needed help in this area. The next 
largest area where they needed assistance (6 percent) was in developing a business plan. 67 


MINORITY BUSINESSES ARE GROWING IN A VARIETY OF 
INDUSTRIES, BUT TARGETED STRATEGIES ARE NEEDED 


Establishment 
CAGR (%) 



Minority Owned Businesses—Top 20 categories—75% of total businesses 


Edjcai.ora Svcs. 


ETg. acclg research 
3tc rel serv 


Arr jse'Tient & Rec. Zvos 


Legal Svcs 

c ocd S'o'es 


Loca oas&arge' trans. 
Wlhaiesa e - Durable 


& drinkir^g 
esanlisbme'rts 
Var jfacxring 


Auto Deale's 


Wholesale - Not- 
Durable 


O 100.000 

Businesses 


Average establishment 
annual growth rate - 2 ?% 


Over-weighted 

Under-weighted 


13 5 7 

Source: 1552EcoiOTiic Census; 1957 Econorrc Census. BC3 anaysis 


9 


11 13 15 17 

MBE CAGR (S) 


CREATE AND DEVELOP OPPORTUNISTIC ENTREPRENEURS 

The focus on economic development for the AAPI community' needs to go beyond the concern of 
establishing new small businesses. To make a true economic impact, it is necessary to take the next step to 
help these businesses grow in size and scale so that they can become competitive. 

A closer look at a comparison between the number of firms owned by AAPIs and Whites and the firm size 
(defined as the number of employees in the business) reveals there is a statistically significant relationship 
(Chi-square= 5913, df = 7, p < .000) between the owner's ethnicity and the firm size (see Appendix F for 
details). A closer look at the residuals in the various cross-tabulated cells reveals that Asians have a larger 
number of smaller firms than predicted by an independent model, while Whites have a larger number of 
bigger firms than predicted by the same model. 

At the heart of any business is its owner(s). For the AAPI community, many businesses are established out 
of necessity, driven by unemployment or limited employment opportunities for their owners. The reasons 
for unemployment among AAPIs can range from labor market discrimination and low English proficiency 
to lack of skills or the inability to transfer training and credentials attained in their respective home 
countries. Nonetheless, businesses started out of necessity are often designed to simply sustain their 
owners. 

AAPI-owned businesses can only exceed this subsistence level of operation if their owners are provided the 
tools and motivation to become opportunistic entrepreneurs. The creation and development of OEs will 


66 The Southern California Minority Business At las, the Community Development Technologies Center and the Merrill Lynch 
Foundation, 2000, p. 19. 

67 Ibid. 













President's Advisory Commission on Asian American and Pacific islanders 


Page 2-1 


increase the ability and probability that AAPI-owned business can grow beyond current levels and 
contribute more to the U.S. economy. The 2002 Census data shows that a significant number of AAPI- 
owned businesses do not have any paid employees. They primarily rely on unpaid family members to assist. 

Opportunistic Entrepreneurs seek business growth especially if they are already positioned in strong 
potential-growth industries. They may be more willing and capable of pursuing innovative strategies such 
as alliances, partnerships, mergers, and acquisitions. They may be better positioned to increase use of 
capital markets and be capable of quicker response to trends in supply chain management. 

Opportunistic Entrepreneurs (OEs) are focused on some sort of innovation or business idea that has significant profit 
potential. They are people who seek growth or expansion opportunities that will go far beyond maintaining a 
subsistence-level business. These are entrepreneurs that will utilize venture/angel-backed startups, private equity or 
bank-financed acquisitions/rollups/expansions, or other financing mechanisms. 

Sustenance Entrepreneurs (SEs) are people who simply start a business in order to sustain themselves or their 
families. They may try to capitalize on a particular skill or capability, like import/export, restaurant, dry cleaning, 
grocery, or other "small" business. They may buy into a franchise. The key is that SEs are entrepreneurial, but do not 
aim to be big. This is often a default business model for immigrants that face barriers to finding employment in 
mainstream businesses. 

Source: Cox, Larry W; Hay, Michael; Reynolds, Paul D; Bygrave, William D; Autio, Erkko. Global Entrepreneurship 
Monitor Revort. 2002 

It may appear that there is little reason to focus assistance on these entrepreneurs. However, it is precisely 
these businesses that we should seek to grow to scale because an infrastructure of medium- and large-sized 
companies that create jobs, technological advances, and world-class products and services will push and 
help grow the U.S. economy. These businesses have the highest potential for growth and expanded 
assistance to them will reap the highest rewards to the economy. The establishment of small businesses 
alone cannot do this. 

Furthermore, small businesses often need larger businesses. Partnerships, alliances, or contracts between 
small and larger businesses have been key to a great deal of economic activity. Larger companies also 
provide mentors and advisors to assist small businesses acquire the tools and training they need to grow and 
improve their operations. 

Research indicates that creating large minority-owned businesses -those with at least $100 million in 
revenue - is key to: 

• Driving significant economic development of the community. 

• Creating meaningful, lasting, and high-paying jobs. 

• Providing a cost-competitive and highly capable supply base for major public and private corporations and 
government. 

• Providing procurement opportunities for smaller minority-owned businesses. 

• Developing opportunities for younger entrepreneurs to identify growth prospects and develop businesses of 
size. 

• Create wealth for minorities. 

• Fostering a new cadre of leaders to further support the historic community/civic leadership. 

The New Agenda for Minority Business Development , Boston Consulting Group, June 2005, sponsored by the 
Ewing Marion Kauffman Foundation 


Creating Opportunistic Entrepreneurs 

Government, business and community organizations, and universities all play a role in providing tools that 
can help AAPI business owners transform from subsistence entrepreneurs to Opportunistic Entrepreneurs. 





President's Advisory Commission on Asian American and Pacific islanders 


Page 25 


A few of these key strategies include: 

• Improving access to capital, credit, and increased bonding capacity. Most minority-owned 
businesses need to look beyond their own resources (friends, family, personal savings) to 
adequately grow to scale. 

• Moving beyond the “lone-wolf’ founder/CEO business model to a model with management 
teams that have the capacity - to optimize growth. While AAPI-owned firms are statistically on 
par with non-minority-owned firms in adopting corporate structures best suited to large-scale 
operations (e.g. S- and C-type Corps), they often struggle with the managerial skills needed for 
business growth (delegation, recruiting, rewarding talent). 68 

• Obtaining competitively-priced business serv ices. Minority-owned businesses face a challenge 
in obtaining access to competitively-priced business services such as legal services, health 
insurance, and risk management policies. Because the majority of minority-ow ned businesses are 
small, they face a disadvantage in negotiating for many necessary businesses services. The surging 
cost of health care, for example, is far higher for small groups and small businesses than for large 
corporations. While data collection is lacking, it is clear that association health plans, health savings 
accounts, and small business tax deductions are important components of remedies for this 
situation. 

• Better utilization of technology and developing value-added products and serv ices. AAPI- 
owned firms can be better positioned to grow to scale to the extent that they focus on better use of 
technology. Receipts per employee in many minority-owned firms are substantially lower than 
comparable majority -owned firms. In the manufacturing sector, majority-owned firms generate 1.5 
times more receipts per employee than do minority-owned firms, whose products also tend to have 
a lower value-added component and. therefore, lower margins. 69 Increased and better use of 
technology can help to increase per employee productivity and capabilities and therefore increase 
receipts and productivity. 

• Accessing information about opportunities. Minority-owned businesses need access to 
information about opportunities that match their firm's capabilities. A number of studies and 
comments made by entrepreneurs have indicated that netw orking and marketing are areas where 
many AAPI entrepreneurs believe could be strengthened. Unfortunately, many AAPI groups report 
low participation rates in civic and business networks that could help improve access to 
information. 


68 Boston Consulting Group, The New Agenda for Minority Business Development. June 2005, sponsored by the Ewing Marion 
Kauffman Foundation, p. 30; <http://wwvv.kauffman.org/pdf/minority_entrep_62805_report.pdf>. 

69 Ibid. 




President’s Advisory Commission on Asian American and Pacific Islanders 


Page 26 


• Mentorship, coaching, counseling, and business executive training. Developing the skills 
needed to effectively manage and grow a 
business is critical for minority entrepreneurs 
especially among those who did not obtain 
an education in the United States. There are 
several good programs designed to help 
entrepreneurs in this area, but much can be 
done to reach out and specifically target 
AAPI entrepreneurs. 

• Certification requirements and 
application processes. The Minority 
Business Enterprise certification and 
application processes at the federal, state, 
and local levels remain a challenge for many 
budding entrepreneurs. In some cases, to be 
eligible for certification requires 
entrepreneurs to be involved full-time in the 
management of the entity. This “full-time 
involvement” as a key factor in determining 
participation in the disadvantages business 
enterprise program is burdensome and start¬ 
up entrepreneurs may have to moonlight in 
order to sustain themselves. 

Community-based organizations have focused on securing funding for life-necessities and other social 
assistance programs. Numerous studies promote the encouragement of entrepreneurship as a means to 
generate greater economic wealth in the community. Training, through local resources and partnerships 
(e.g. SCORE) can enable AAPIs to not only reach subsistence levels but also to develop more OEs. The 
Commission recommends that a federal agency, such as the SBA, facilitate entrepreneurship counseling and 
mentoring programs targeted to AAPIs move them to self sustaining levels faster. 


Examples of Minority Business Mentorship & 
Training Programs 

SBA Small Business Development Centers 

MBDA Minority Business Enterprise Centers 
&Native American Business Enterprise Centers 

Department of Labor Opportunity Conference. 

SCORE: The Service Corps of Retired Executives 

HEMP: Helzberg Entrepreneurship Mentoring 
Program 

Lawrence N. Field Center for Entrepreneurship at 
Baruch College, Zicklin School of Business, City 
University of NY, New York, NY. 

Greater Kansas City Chamber of Commerce 
POWER Program 

Bellevue Entrepreneur Center, Bellevue, WA 



President's Advisors Commission on Asian American and Pacific Islanders 


Page 27 


COMMUNITY DEVELOPMENT AS AN ECONOMIC GROWTH STRATEGY 


Community development must be considered in conjunction w ith economic growth for the AAPI 
population. Without a strong community foundation. AAPIs, especially new immigrants, are hard-pressed 
to find access to the tools and resources needed to build successful personal lives and businesses in the 
United States. 

As stated earlier, immigration can be either an enormous economic asset or a drain on society. During our 
site visits, AAPI community leaders highlighted the reduction in federal funding assistance for community 
development. With the AAPI immigrant population expected to grow significantly and with government 
resources shrinking, the role of community-based organizations (CBOs) and faith-based organizations 
(FBOs) will grow r in importance in supporting the community needs of AAPIs, entrepreneurs, and 
immigrants. 

COMMUNITY DEVELOPMENT - A STRATEGY FOR AAPI ECONOMIC GROWTH 

CBOs and FBOs serve as important links between those in need of services and the services that are 
available to them. While government plays an important role in providing resources, CBOs and FBOs 
remain crucial in assisting and making them accessible. CBOs and FBOs offer effective channels for 
reaching out to ethnic communities because they are able to communicate in a linguistically- and culturally- 
competent manner to individuals w ith limited English proficiency. This asset has a tremendous value for 
government agencies that seek to disseminate information among hard-to-reach populations especially 
AAPI subgroups. 


Examples of CBO Sen ices 

The Chinese Community Center of Houston offers an adult literacy program that includes ESL and adult basic language 
instruction, citizenship classes, and adult secondary education. 

Chinese American Planning Council of New York City has comprehensive career training programming that has assisted 
thousands of immigrants to develop new skills and to identify employment and business opportunities. 

Korea Town Youth Community Center of Los Angeles offers the Korean Money Smart financial literacy curriculum. 

Cambodian Association of Illinois, along with three other Cambodian associations in Oregon, California, and Florida, are 
collaborating with the Khmer Health Advocates to address the high prevalence of diabetes among Cambodian refugees. 

9/11 and the Council of Peoples Organization served as an advocate and legal counseling center for South Asians, particularly 
Muslims, living in Central Brooklyn that were detained and summoned after the 9/11 attacks. The organization also offers 
community members ESL instruction, helps them to secure food stamps, and provides medical and mental health services. 

The National Asian Pacific Center on Aging is a national advocate for AAPI seniors. It also provides training and 
employment opportunities for AAPI seniors and operates a multilingual hotline to educate AAPI seniors on the Medicare Part 
D Discount Prescription Drug Program administered by CMS. 

Little Tokyo Services Center is the catalyst and sponsor for the development of more than 500 affordable apartments in 
different Asian American enclaves in Los Angeles. 


In the AAPI community, CBOs and FBOs are often lifelines for new immigrants, providing the assistance 
that many need in order to reach a level of self-sufficiency. CBOs and FBOs take the lead in providing 
access to opportunities to improve language and job skills, assistance in seeking employment, life and 
culture training and counseling, financial assistance, housing assistance, mentorship, advocacy, and other 
basic needs resources. 









President's Advisory Commission on Asian American and Pacific isianders 


Page 28 


Under the administration of President George W. Bush, faith-based organizations are also being recognized 
as indispensable resources for providing social services to millions of Americans. FBOs are now on an 
even keel w ith community-based organizations to seek federal funding for the myriad services they provide 
underserved communities and populations. 


The Commission’s site visits have shown that faith-based organizations provide an important sense of 
social safety for AAPIs. They are particularly valuable for ‘under-represented’ AAPIs -- those who live in 
more remote regions of a state where resources and infrastructure to provide social services are often not 
quickly available. 

Manv AAPIs are affiliated w ith a house of worship; those who are disenfranchised due to immigration 


status usually prefer to seek assistance from a 
trusted minister. In North Carolina, for example, 
Asian Americans made up almost 2 percent of the 
population, yet there are over 80 Asian churches 
and missions in the state representing 17 different 
language groups. These range from Korean 
churches, of which there are 21, to Kh’mu, of which 
there is only one. Examples are many: the 
Montagnard Christian Church of North Carolina 
plays a key role in financially supporting 
Montagnard descendants as well as, socially, and 
spiritually; the Raleigh Chinese Christian Church 
offers valuable social services to Chinese turkey 
farmers in Goldsboro, North Carolina; and the 
Samoan Congregation Church of California is a 
strong advocate and voice for the Samoan 
population in Los Angeles. 


Youngnak Presbyterian Church, CA 

Youngnak Presbyterian Church (Youngnak) has been 
providing invaluable community services to AAPIs. 
Established in 1973 with 39 members, Youngnak is one 
of the oldest and largest Korean American churches in 
the United States, with 8000 current congregation 
members. Under the current vision and leadership of 
Senior Pastor Hyung Cheon Rim, Youngnak meets the 
spiritual needs of the Korean American community in 
Southern California. It also plays a key role in 
community empowerment through various outreach 
ministries by providing important community services 
to both Korean and non-Korean immigrants in L.A.. 

http://www.livedtheology.org/wkgp_community_3.htm 


Promising practices in which faith-based organizations have played a vital role in strengthening AAPI 
communities are found throughout the nation. For example, there are over 582 Korean faith-based 
organizations that serve over 600,000 Korean Americans and other ethnic groups in the Greater Los 
Angeles Area. These faith-based organizations provide comprehensive social services to their members 
and help them along the road to self-sufficiency. 

CBOs and FBOs Serve as a Link to Resources for Entrepreneurs 

Beyond providing social services, CBOs and FBOs also serve as a critical link between entrepreneurs and 
resources. While there are numerous government, private, and academic resources to help entrepreneurs, 
the Commission found that access to these resources is still a problem for many AAPI entrepreneurs. The 
same CBOs and FBOs that help to bridge the gap between social services and immigrants can also help to 
bridge the gap between minority entrepreneurs and business resources. 


Many CBOs have taken the lead in providing some direct support and services to AAPI professionals and 
entrepreneurs. For example, AAPI professional associations, like the National Association of Asian 
American Professionals (NAAAP), support AAPI advancement, forging leaders of tomorrow through 
professional development, multiculturalism, networking, and community service. 


70 Baptist Convention of North Carolina, http://www.bscnc.org/churchministries/multiculturalministries/asian.htm. 

71 Im, Hyepin. "Being Out in the Community Empowering the Korean American Church Community, Part 1." 

(http://us_asians.tripod.com/articles-ka-churches.html). November 14, 2005. 





President's Advisorv Commission on Asian American and Pacific Islanders 


Page 29 


SUPPORTING COMMUNITY DEVELOPMENT 

One of the Commission's goals is to further improve access and communication by helping to foster 
partnerships between AAPI-serving organizations and those agencies and departments that administer and 
oversee information and resources. 

Fostering Partnerships with Federal Agencies 

CBOs have historically served as a key medium for government agencies in implementing federal 
programs. Two examples in which this type of govemment/community/faith-based partnership has proven 
beneficial are the Lifelink/Link-up in North Carolina for the Montagnard communities and the partnership 
between the Department of Health & Human Services (HHS) Centers for Medicare and Medicaid Serv ices 
(CMS) and the National Asian and Pacific Center for Aging (NAPCA). (See text box below for specific 
information.) 

There is a clear and distinct value to the AAPI community' and to the federal government in these 
partnerships. These partnerships improve access to and information about federal services and programs to 
AAPIs. They also help to increase the capacity' and abilities of AAPI-serving organizations by providing 
them the experience and resources to work with organizations on a larger scale. 

Lifelink/Link-up Program. 

As a result of the collaboration between the Montagnard Christian Church in North Carolina and the AAPI Liaison of 
the Federal Communication Commission, a significant number of low-income Montagnard residents benefit from a 
discount of their telephone services. 

CMS (HHS), AoA & NAPCA. 

Through an inter-agency agreement with the Administration on Aging (AoA), the Centers on Medicare & Medicaid 
Serv ices (CMS) provided resources to NAPCA to assist Medicare beneficiaries with the new prescription drug benefit 
(Medicare Part D). This collaboration among CMS, AoA and NAPCA resulted in one of the most effective national 
outreach efforts for a federal program. With this support, NAPCA developed and ran an exceptionally successful 
outreach program on Medicare Part D to AAPI seniors. Over 40,000 seniors were assisted due to the creation of the 
first national toll-free multilingual Helpline and the highly effective use of earned ethnic media. The NAPCA 
Helpline was essential for seniors who face language, cultural, and geographical barriers to obtaining necessary- 
individual assistance. The ethnic media stories generated from outreach events informed elders about the benefit as 
well as the means by which they could access the benefit in their own language through the NAPCA Helpline that 
helped elders navigate and sign up for the Medicare Part D benefit. This effort and collaboration, which took place 
during both the 2006 and 2007 Part D enrollment periods and continues today, has contributed to 79% of eligible 
AAPI Medicare beneficiaries being enrolled in Part D or the Medicare Retiree Drug Subsidy (RDS). This is the 
highest percentage of enrollment among minority populations. 


A primary purpose of the Commission’s technical assistance conferences was to foster connections between 
federal agencies and the AAPI community and AAPI-serving organizations. It is hoped that some of these 
connections will result in more community- partnership with the federal government to serve the AAPI 
population. 

Interagency Collaboration within the Federal Government 

By signing Executive Order 13339, the President not only established the President's Advisory Commission 
on Asian Americans and Pacific Islanders but he also called on all federal agencies to mobilize their 
resources to address the unmet needs of Asian American and Pacific Islander businesses and communities. 
The Interagency Working Group (IWG), composed of Deputy Secretaries and senior officials from federal 
departments and designated independent agencies, advises the President through the Secretary of 
Commerce on Initiative Activities. The IWG is to develop an inventory of existing programs and funding 
levels targeted towards AAPIs. Additionally, each agency is responsible for developing an annual 
implementation plan that documents its actions taken toward meeting the mandates of the Executive Order. 






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A Coordinating Committee (CC) composed of senior-level designees from across executive departments 
and designated independent agencies supports the work of the IWG as the implementation arm of the 
Interagency Working Group. 

Connecting Large Institutions 

Most major institutions, such as universities and academic medical centers, have a strong track record in 
seeking research and service grants to address needs in the community. However, because of insufficient 
available data on many AAPI subgroups and issues, it is often difficult for these organizations to be aware 
of AAPI needs or of AAPI-serving organizations that can provide assistance. AAPI-serving organizations, 
likewise, will often not be aware of institutions or organizations that are seeking to serve the AAPI 
population. 

In many communities that have small cluster populations of AAPI subgroups, data on those AAPI 
subgroups is usually not available. The lack of data often results in a lack of response to even the most 
pervasive needs among the AAPI subgroups. National advocacy organizations serving AAPIs or local 
CBOs or FBOs may have more access and accurate data on these small subgroups than state or local 
governments, but large agencies and institutions may not be aware of these organizations or of their abilities 
to help extend services to AAPIs. AAPI-serving agencies are also often not informed of agencies or 
institutions that are soliciting funding or have been awarded funding to serve AAPIs. It would be 
advantageous for funding agencies and grant recipients to exchange information with national advocacy 
organizations to connect funding to individuals and groups in need and to connect with organizations that 
can be of assistance in serving AAPI communities. 

Collaborating with Corporations 

The Commission’s attention was drawn to reduced federal assistance for CBOs during site visits. With 
declining government funding, CBOs must look beyond government support for sustaining their service 
capacities. Mainstream American corporations are becoming more interested in supporting AAPI 
communities from a marketing and social investment perspective. CBOs can assist corporations in reaching 
out to the largely untapped AAPI market, one that is significant in numbers and in buying power. 

CBOs can also assist corporations in directing charitable resources to address the unmet needs of the AAPI 
communities. The Chicago Chinatown Chamber of Commerce has been successful in aligning the business 
and social investment agenda of major corporations with the service agenda of community-based 
organizations. The Chicago Chinatown Chamber of Commerce has been able to mobilize corporate 
resources to support many social service programs for the Chicago Chinatown. The Chinese American 
Planning Council, New York, is another community-based organization that has sustained its programs by 
fundraising, despite reductions in public funding. 

Major corporations, such as pharmaceutical and insurance companies, have been very progressive in 
allocating corporate-giving to minority communities in order to improve quality of life. Several major 
pharmaceutical manufacturers have invested in improving disease management strategies in Indian 
Americans. State Farm Insurance’s Good Neighbor Service Learning Grant Program provides grants to 
promote youth as leaders by engaging youth in efforts to identify and address the needs of their 
communities. 

Mentorship and Skills Development for Community Advancement 

Mentorship and leadership development are essential components of AAPI community and economic 
advancement. Grooming community leaders is critical in strengthening and sustaining a community-based 
infrastructure. Both public agencies and private organizations have invested in developing new leaders for 
the 21 st century workforce. 


72 Featured Article: Diabetes Among Indian Americans Initiative, Journal of American Association of Physicians of Indian Origin, 
Winter 2002/2003, <http://www.cof.org/files/Documents/Publications/Cultures_of_Caring/bibasam.pdft>. 







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The National Coalition for Asian Pacific American Community Development sponsored the “Community 
in the CAAPITAL Program."" a community leadership development program. It provides opportunities for 
staff of AAPI-serving community -based organizations to travel to Washington D.C. to learn about policies 
and resources relevant for working in low-income and underserved AAPI communities. This program 
serves to connect AAPI CBOs to Washington, D.C. resources and to increase the accountability of public 
policymakers and elected officials on issues impacting AAPIs. Components of the program include a 
"Government 101" briefing, meetings with key federal agencies, elected officials and national community 
development organizations, dialogue with other national AAPI organizations, and training on advocacy for 
non-profit organizations. 

Besides grooming new leaders, younger CBOs can strengthen their organizations through peer-to-peer 
mentorship, interagency partnership, or by using a more experienced community-based organization as an 
incubator. CHHAYA (“Shade”) was developed through an incubation period and continuous mentorship 
support by a more experienced CBO. ' In 2000, Asian Americans for Equality helped launch CHHAYA, a 
South Asian community - development corporation focusing on housing, small business, and other social 
service needs in the South Asian community (see text box below for an excerpt about CHHAYA). 

“There are young people who very much want to fight and know' their rights, and want their 
community’ as a whole to be educated," said Kui. “We think it's important for Chhaya to exist to 
harness that and bring people together so they can also see there’s a larger (APA) community' that we 
need to unite. Whether it’s Chinese, Korean or Japanese, the struggle is the same and we should be 
together.” —Christopher Kui, Executive Director of AAFE in the article “New Organization Focuses 
on South Asian Housing Issues in NYC” by Tomio Geron, AsianWeek, May 10-16, 2002. 

Fostering Collaboration among CBOs and FBOs 

One of the most significant challenges that the Commission witnessed for AAPI-serving CBOs and FBOs is 
their lack of critical mass. While there are several successful and larger CBOs, there are an overwhelming 
number of small, struggling organizations. The social safety net infrastructure and community capacity are 
particularly inadequate in some linguistically-isolated and economically-distressed neighborhoods. These 
communities often lack data to justify their communities’ needs and to gamer sufficient allocations of 
government funding. Therefore, the available community development resources, systems, and programs 
often do not match the level of services needed by AAPI communities. 

This problem is largely the result of the challenge inherent in serving the immensely diverse AAPI 
community. The different waves of immigration from different AAPI groups over the years spurred the 
creation of organizations designed to provide services to address the needs of the specific ethnic groups 
with the most severe needs of each particular period. For example, the w ave of immigration from Southeast 
Asia, particularly from Vietnam, beginning in 1975 and through the 1990s resulted in the creation of several 
CBOs designed to help resettle Vietnamese refugees and immigrants. Regardless of the cause of this 
multiplicity, the result is the existence of numerous, diverse AAPI-serving organizations with similar 
objectives but different client targets that often compete for the same scarce resources. 

In this environment of limited resources and growing needs, collaboration is essential in maximizing 
resources and service capacities. Federal agencies and national organizations that award grants have been 
encouraging and supportive of collaborations and strategic partnerships. 

Given the scarce and declining resources available to qualified community-based and faith-based 
organizations, successful communities have found ways to effectively collaborate across organizations to 
secure funding, build critical mass for larger-scale projects, and provide more extensive training and 
support of entrepreneurship and business development. Currently, there is no forum to share these success 
stories. We recommend that a Strategic Working Group (SWG) of key federal agencies be established to 
coordinate the development of programs that foster greater collaboration among the various AAPI 


73 Chhaya CDC, http://wwAv .chhayacdc.org/what.htm. 





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organizations that are currently serving their respective communities. The Commission feels that a National 
Chamber of Commerce for AAPIs will help to foster the interaction, sharing of experiences and contacts, 
and increasing economic relevance of various regions in global trade and business. We recommend that 
steps be taken to enable the establishment of a National Chamber of Commerce for AAPIs. 

A collaborative approach would allow organizations to leverage multiple resources to support a common 
goal and improve the odds of grant reception. A further benefit in forming partnerships is finding synergy 
with organizations that share a common goal, allowing them to share skills and expertise, and thus 
increasing the probability for success and reducing the duplication of efforts. The result of the collaboration 
could be mutually beneficial for all partners. 

There are many examples of successful CBO collaborations. In Los Angeles, the Little Tokyo Service 
Center, SIPA, Koreatown, and Chinatown Service Center are beneficiaries of an effective collaboration. 

The interethnic partnership has yielded more than 800 units of affordable housing in Los Angeles (see text 
box below for further details about The Little Tokyo Service Center). 

Another organization that represents a network of CBOs and FBOs is the Southeast Asia Resource 
Action Center (SEARAC). This national network organization has a membership of 180 CBOs and 
FBOs. 74 It provides sub grants, training, and technical assistance to 18 Southeast Asian American 
CBOs and FBOs in California, the District of Columbia, Maryland, North Carolina, Virginia, and 
Wisconsin. 


The Little Tokyo Service Center Community Development Corporation (LTSCCDC) participates in a number of multi-ethnic 
collaborations, which can serve a broad range of consumers across ethnic lines. For example, the LTSCCDC is the lead agency in 
the Asian Pacific Islander Small Business Assistance Program (API SBP), which is a consortium of 5 community-based nonprofit 
organizations (partnering with Chinatown Service Center, Search to Involve Pilipino Americans, Koreatown Youth and Community 
Center, and Thai CDC). “This consortium provides counseling and assistance to Asian American communities and it works well 
because of the trust and reputation of each partner group within their communities and because of the cooperation of each group 
within the consortium." Bill Watanabe, Executive Director, LTSC. 

“Trust that grew from the ability to understand each others weaknesses and share our strengths is providing a broader range of 
programs than any of us could do separately.” Erich Nakano, Deputy Director, LTSC. 75 


A key goal of the Commission’s visits to locations around the country was to connect different 
AAPI-serving organizations in order to encourage the development of collaborative efforts and the 
fostering of synergies. The Commission’s site visit to North Carolina brought together several AAPI 
organizations, CBOs, and FBOs for the first time. The result of this visit was the formation of a 
coalition of several professional organizations and CBOs together with the Montagnard Christian 
Church to help meet the needs of the Montagnard Community. 

ECONOMIC DEVELOPMENT - A STRATEGY FOR COMMUNITY DEVELOPMENT 

Economic growth supports community development. AAPI entrepreneurs have a strong track record of 
serving on the boards of community-based organizations and providing resources to them. Not only do 
these entrepreneurs give back to their community, but they also help to provide their children with the 
ability and commitment to do so, as well. 

Having experienced first-hand the struggles of new immigrants, some U.S.-raised first- and second- 
generation AAPIs have chosen to dedicate their careers to improving the quality of life of their parents and 
new AAPI immigrants. These AAPIs deeply understand the challenges of AAPIs and the need for a social 

74 California Assembly Budget Subcommittee on Health and Human Services Cash Assistance Program for Immigrants Testimony 
for Khammany Mathavongsy Southeast Asia Resource Action Center March 1, 2006 <http://www.searac.org/tst-helpkham3-l- 
06.pdf>. 

75 Collaboration Builds AAPI Capacity in Lost Angeles, Fieldworks, HUD Nov/Dec 2000. 






President s Advisory Commission on Asian American and Pacific Islanders 


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safety net infrastructure for this population. They have started grassroots social service organizations to 
serve as navigators and advocates for their communities, dealing with one issue and one challenge at a time. 
They also reach out to other ethnic groups to assist them in the development of these organizations. The 
Chinese American Planning Council in New York City directed by David Chin, a U.S.-raised Chinese 
American, and Little Tokyo Service Center (LTSC), directed by Bill Wanatabe. a second-generation 
Japanese American, are just two prime examples of second-generation AAPI investments. 

Entrepreneurs and their families who give back to the community not only support CBO and FBO efforts, 
but they also cultivate new' leadership and encourage community' and civic engagement and advocacy. 


The Asian American and Pacific Islanders for Philanthropy (AAPLP) was founded in 1990. It is a national 
membership organization comprised of foundations, staff and trustees of grant-making institutions, and representatives 
of nonprofit organizations. It serves as a catalyst to strengthen the infrastructure of AAPI communities and expand the 
leadership of AAPI professionals in the philanthropic field, thus broadening philanthropy’s understanding of the 
communities in its constituency and increasing resources to underserved populations. _ 


Community development advocates should not limit their focus on community development as an avenue to 
economic empowerment. They should also recognize and encourage economic development as a means to 
strengthen the community. The role that CBOs and FBOs can play in helping to link valuable resources to 
AAPI entrepreneurs is one that needs to be expanded. Much more can be done in this area to support 
entrepreneurs from a community standpoint. 

Improving communication and outreach to the aapi community 


AAPIs are generally not well-informed of available resources and services, due to language barriers and 
isolation. The problem is compounded by the great diversity of the population, which demands broad 
language capabilities and a variety of outreach strategies. Fear of authority, distrust of government, and a 
culture of self-reliance also contribute to some access barriers. Targeting information to the AAPI 
community, therefore, has been a major challenge for governments, corporations, and institutions. 


The Administration has instituted changes to the delivery methods of federal funding to better provide funds 
where they are needed. An example is the creation of the Office of Faith-Based and Community Initiatives 
in the White House, Departments of Labor, Health and Human Sendees (HHS), Housing and Urban 
Development (HUD), Energy (DOE) and 


Justice (DOJ). The Commission found that 
communities are not as aware of the federal 
resources available to them as expected. In 
addition to resources, communications appears 
to be an area where progress can be made in 
order to better serve AAPIs. 


A 2004 survey conducted by the Asian American Legal 
Defense and Education Fund (AALDEF) in 23 cities 
revealed that more than half (51%) of all respondents 
received their news about politics and community issues 
from the ethnic press rather than from mainstream media 
outlets. The newspaper was the most common source used 
among those using ethnic media sources. 


The Commission has found that enhancing 

partnerships with AAPI-serving organizations and improving direct communications and outreach to AAPIs 
through ethnic media are very effective strategies for improving access to resources and information to the 
community. Partnerships with CBOs and FBOs can help make information culturally sensitive and 
relevant, and ethnic media can play a significant role in disseminating information, especially to the first- 
generation immigrants who have limited English proficiency. 


Asian American newspapers reach a substantial percentage of the Asian American adults in the United 
States. Approximately 80 percent of all Korean. Chinese and Vietnamese adults read an ethnic newspaper 





President's Advisory Commission on Asian American and Pacific islanders 


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on a regular basis. 6 The reach of Indian, Filipino and Japanese newspapers is smaller but still impressive; 
more than half of the adults in these groups read an ethnic newspaper a few times a month or more. 
Korean, Vietnamese, and Chinese television stations are also rapidly increasing in popularity, along with 
Internet access; 67 percent of all Asian Americans access the Internet, and half of them prefer ethnic 
websites to mainstream websites. 

Various mainstream industries have successfully reached the AAPI populations by using ethnic media to 
achieve their market share. In recent years, government agencies have also used ethnic media to 
disseminate health promotion and disease prevention messages to AAPIs. Examples include the 
Environmental Protection Agency and HHS entities: Center for Disease Control and Prevention, National 
Institutes of Health, Center for Medicare and Medicaid Services through its partnership with the National 
Asian Pacific Center on Aging. 


76 Ethnic Media in America: The Giant Hidden in Plain Sight, Executive Summary, Conducted by Bendixen & Associates For New 
California Media (NCM) <http://www.ncmonline.com/polls/executivesummary.pdf & 
http://www.ncmonline.com/polls/full_em_poll.pdf.> 




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BARRIERS TO REALIZING AAPI ECONOMIC POTENTIAL 


A APIs experience many challenges during their journeys taken in search of the American dream. Some 
have faced more challenges than others, depending on when they immigrated, or their level of education 
and English fluency. Based on interviews with AAPIs during the Commission’s visits, the main issues that 
most AAPIs face involve challenges in accessing programs and services. Many of the challenges faced by 
AAPIs are the result of language barriers, isolation, low political participation, and racial discrimination. 
But these challenges are often invisible to mainstream Americans. 

The model minority myth 

At first glance, one might think that Asian Americans and Pacific Islanders need little assistance to prosper 
in the U.S. economy . According to the 2000 Census, AAPIs are more likely than the national average to 
grow up in two-parent homes, they earned the highest median family income, and they graduated from 
college at disproportionately high rates. This view , which is often perpetuated in the media, takes some 
characteristics of the AAPI community and promotes the assumption that all AAPIs will have no difficulty 
quickly climbing the ladder of success in this country. While true for some AAPIs, this stereotype masks 
the real problems, especially of newer immigrants, that are quickly revealed by a deeper look into relevant 
existing data and into the AAPI community. Below', we share some data about the AAPI community to 
highlight its diversity’ and complexity (see Appendix C for population and sales per firm data). 

• Language: 39 percent of AAPIs have limited English proficiency compared with 8 percent of all 
other populations. 

• Poverty: Asians and Pacific Islanders were more likely to live in poverty - 10.2 percent - than 
Non-Hispanic Whites - 7.8 percent - in 2001. 8 In 2005, 12.6 percent of the national population 
was living below the poverty’ level. 4 The proportion living below' the poverty level for all Asian 
groups was 11.1 percent. 811 The three year (2003-2005) average poverty rate for the Native 
Hawaiians and Pacific Islanders was 12.2 percent. 81 Disaggregating the data even further shows 
that certain groups have even higher poverty- rates (e.g., Samoans at 19.8 percent individually and 
18.5 percent family 8 ', and Tongans at 23 percent 8 ’). 

• Education: Asians and Pacific Islanders are more likely than Non-Hispanic Whites to have earned 

84 

at least a college degree, but they are also more likely to have less than a ninth-grade education. 
Detailed data reveals a wide disparity amongst Asian and Pacific Islander groups. Close to two- 
thirds of Indian Americans - 61 percent - had earned a bachelor’s degree or more. 8? By 


77 The New Face of Asian Pacific America, edited by Eric Lai and Dennis Arguelles. Published by AsianWeek and UCLA’s Asian 
American Studies Center, in partnership with the Organization of Chinese Americans and the National Coalition for Asian Pacific 
American Community Development. 2003, p. 29. 

78 U.S. Department of Commerce News, Poverty Rate Rises. Household Income Declines, Census Bureau Reports, September 24, 
2002, U.S. Census Bureau. 

79 Income. Poverty, and Health Insurance Coverage in the United States: 2005, U.S. Census Bureau. 

80 Ibid. p. 14, Table 4. 

81 U.S. Census Bureau. 2000 Census Summary File 4. PCT 142, National Income and Housing Profile for Asian Americans, Native 
Hawaiians and Pacific Islanders. Asian Pacific American Community Development Data Center; 
http://www.census.gov/prod/2006pubs/p60-231.pdf; p. 15, Table 5. 

82 A Portrait of American Samoans. Compiled from 2000 U.S. Census Bureau, The Native Hawaiian Research Center. 

83 23% of Tongans live below poverty line. Matangi Tonga Online. March 31, 2005, 
http://wwiA-.matangitonga.to/scripts/ artman/exec/view.cgi?archive=4&num=825. 

84 U.S. Census Bureau. The Asian and Pacific Islander Population in the United States: March 2002. Current Population Reports by- 
Terrance Reeves and Claudette Bennett. Issued May 2003. 

85 U.S. Embassv of India, http://www.indianembassy.org/indusrel/clinton_india/india_americans.html. 








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comparison, only 11.7 percent of the Hmong population, 86 7.5 percent of Laotians, 87 and 9.0 
percent of Cambodians had earned a degree from a four-year college. 

• Employment: In 2002, 6 percent of the Asians and Pacific Islanders in the civilian labor force 
were unemployed, compared with 5 percent of the Non-Hispanic White population. 88 

• Housing: In 2005, less Asian Americans owned their homes (60.1 percent vs. 68.9 percent) and 
more rented their homes (40 percent vs. 31.1 percent) than compared with the rate overall. 89 Asian 
households are also much more overcrowded than those of the total population. The rate of 
overcrowded homes, with 1.01 and more occupants per room, is, for Asians as a group, 4 times the 
national rate. 5 groups among the Asian population - Bangladeshi, Cambodian, Hmong, Laotian, 
and Vietnamese - live in owner-occupied housing with rates of overcrowding 7 times that of the 
national average. 

• Health: AAPIs aged 35-54, in general, have a 1.3 times higher relative risk of death from stroke 
than Whites; 73 percent of Japanese American men have high blood pressure. 90 Asian American 
women have the lowest rate of cervical cancer screening (45 percent); the rate for White Americans 
is 63 percent. 91 

• Aging: The Asian American Senior population is expected to grow at a faster rate than all other 
Americans, according to the U.S. Administration on Aging. 

For more statistical information about the AAPI population, see Appendix C. 

What accounts for the disparity between the image of the successful AAPI community and these statistics? 
The answer lies in the immense diversity of the AAPI community and its experiences. The AAPI 
population is extremely diverse. It encompasses 50 ethnic subgroups and 100 language groups; each group 
has unique experiences and needs. AAPI culture and language diversity presents many obstacles. There 
is no “one-size-fits-all” solution to address the social issues, stimulate economic and community 
development, and increase political empowerment for AAPIs as a whole. Even for basic services, such as 
health and human services, it is a challenge for government and social service agencies to provide 
linguistically- and culturally-competent services for such a diverse group of people. 

The Diversity of AAPI Immigration Experiences 

The misconception that categorizes AAPI as one large group instead of distinct ethnic groups with unique 
languages, needs, and problems has masked the challenges of AAPIs. 

AAPIs include many different populations with different immigration patterns and history in the U.S. Some 
AAPIs are fourth- or fifth-generation Americans, descendents of those who settled here as early as the mid- 
1800s. The majority of AAPIs in America today (up to 70 percent), however, are more recent (first- 
generation) immigrants or refugees. The differences between fifth-generation Japanese Americans and a 
Cambodian refugee may easily be masked, however, when data derived from different ethnic groups are 
presented in aggregate form. 


86 Hmong 2000 Census Publication: Data & Analysis, http://www.hmongstudies.org/HmongCensusReport.pdf. 

87 Not the "Model Minority", May 4, 2003. http://www.searac.org/pr-2000-census.html. 

88 U.S. Census Bureau, The Asian and Pacific Islander Population in the United States: March 2002, op. cit., p. 5. and 
http://www.census.gov/population/socdemo/race/api/ppl-184/tab9.pdf. 

89 U.S. Census Bureau, Housing and Household Economic Statistics Division. March 01, 2006. 

90 Asian/Pacific Islanders and Cardiovascular Diseases—Statistics, American Heart Association, 2004 
<http://216.185.112.5/downloadable/heart/1075706941602FS03 AS04.pdf>. 

91 Women's Health Week Focuses on Minority Females. Healthlink, http://healthlink.mcw.edu/article/1021047874.html. 

92 President's Advisory Commission on Asian Americans and Pacific Islanders, A People Looking Forward: Action for Access and 
Partnerships in the 21st Century, Interim Report to the President and the Nation, (Jan. 2001), p.7. 

9j http://www.ntac.hawaii.edu/downloads/products/briefs/promisingpractices/doc/PPBVol7_Issuel.doc. 





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However, it is not simply when they came to the U.S. that makes a difference; the journeys and experiences 
of AAPIs, as well as the challenges that they face, are dependent on many other variables, including history, 
country of origin, relationships with the U.S., immigration patterns, generational status, individual age at 
immigration, developmental processes, gender, responsibilities, degree of acculturation, language fluency, 
values, and traditions. Some immigrants or refugees arrive well-educated, come with financial resources, 
and are able to easily assimilate into U.S. culture. Others come with a significant lack of preparation and 
the skills that would allow them to successfully function in the U.S. society. 

For example, a Chinese immigrant from Taiwan with an advanced degree, raising a family in the Research 
Triangle of North Carolina would have a vastly different journey than a Chinese immigrant from Fujian 
Province who is jobless and living in New York City's Chinatown. “Vietnamese and Hmong, though both 
Indochinese, differ in their basic cultural patterns. The Vietnamese, many with Chinese ancestry have a 
sophisticated literate culture and strong abilities to adapt to the market society; the Hmong have no written 
language, nor skills that are easily applicable to American labor needs.’' 94 

The range of immigrant experiences and the history behind each individual is vast; these differences 
significantly affect AAPI needs as they have sought economic progress in the United States. Problems of 
the AAPI population, along with the possible solutions to those problems, therefore, are not often easy to 
identify. With almost each new wave of immigration, the problems and potential solutions change. 

Generational Differences and the Assimilation Paradox 

One of the most challenging issues that AAPIs face is the struggle with the generational and cultural 
conflicts that surface as the children of first-generation AAPIs emerge and assimilate into second- 
generation youth. While first-generation AAPIs struggle to find their way in American society, many 
second-generation AAPIs struggle to find the balance between becoming mainstream Americans and 
preserving their culture and ethnic identity. 

First-generation AAPIs are constantly struggling to navigate different but equally complicated 
environments. While their resources and abilities may be different, every first-generation AAPI must 
reestablish a way of life upon arrival in the U.S. and must attempt to secure a way to meet basic necessities. 
Some of the areas in which first-generation AAPIs commonly face dilemmas include job skills 
development, housing, employment, childcare, senior care, and health care. There are multiple stressors 
and inevitable events that make up the path of every first-generation immigrant’s journey as they strive to 
balance traditional ties and customs with assimilation into a new culture. These pioneers of the AAPI 
community are often lost within the American system and have little knowledge of the resources that can 
assist them and their businesses. This is why many turn to the protection and support offered by ethnic 
enclaves. 

Ethnic enclaves can serve as the social safety net for AAPI immigrants and refugees. They provide cultural 
centers, job centers, and “homes away from home” for AAPI immigrants. For AAPI entrepreneurs, these 
enclaves may provide a safe starting point for developing businesses, but they can also trap entrepreneurs 
into limiting their market potential by steering entrepreneurs into low-growth businesses with a limited 
customer base. This enclave mentality also has another negative aspect. These enclaves can breed self¬ 
isolation among AAPIs and prevent them from accessing services, assimilating into mainstream society, 
having their voices heard, and achieving political empowerment. During the 1992 Los Angeles riots, the 
Korean American businesses suffered significant economic losses. The isolation of the Korean American 
businesses became a serious handicap to them in their efforts to access federal and state assistance to 
recover from those crippling losses. After the September 11 terrorist attack in New York and the Hurricane 
Katrina disaster, CBOs played a crucial role in the recovery of AAPI communities and AAPI-owned 
businesses in those regions. Therefore, the Commission believes that strengthening CBOs within AAPI 
communities is very important for improving their quality of life and sense of security. 


94 Toyoshima, Tak (2005), Secret Asian Man. <http://www.ntac.hawaii.edu/AAPIcourse/downloads/pdf/AAPIcourse_Partl.pdf>. 





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Western education, white-collar job skills, and a relatively more stable financial foundation may spare 
second-generation AAPIs from the challenges faced by their first-generation immigrant parents, but this 
group faces a different set of cultural challenges and barriers. This group often attempts to simultaneously 
navigate the cultural values of their parents while also trying to forge ahead into mainstream society. 

Eager to become more acculturated, most second-generation AAPIs move outside of their ethnic enclaves 
and often seek lifestyles and careers that are more mainstream to U.S. culture. These decisions and desires, 
however, may put them at direct odds with their parents. 

First-generation parents may strongly advise their second-generation children to avoid “standing out’' in 
society, to pick careers and lifestyles that are understood by their parents (such as doctors and engineers) 
and to avoid risk. Members of the first generation often feel that they took risks so their children would not 
have to do so. But for the second-generation to significantly surpass the successes of their parents, they will 
need to go beyond the experiences of their parents and chart new courses in mainstream America. They 
will have to take risks that their parents were not able or willing to take in order to grow. The strong 
importance of filial piety in the AAPI culture, however, makes this dichotomy a real struggle for many 
second-generation AAPIs and their first-generation parents. 

Becoming more assimilated into American society, however, has also not helped second- generation AAPIs 
gain better access to services and opportunities. Despite their knowledge of the American system, their 
higher educational attainment, and their broader social network, the network to which second-generation 
AAPIs are exposed may be less reliable than the network embedded in the ethnic enclaves, which is 
developed by and tailored for first-generation AAPI immigrants. This becomes particularly apparent when 
second-generation AAPIs start trying to identify appropriate caregivers or services for their non-English- 
speaking parents or as they navigate the social service system in search of support and solutions. 

As second-generation AAPIs become more mainstream, they have a higher expectation for social equality 
in their professional and civic lives, but because of their broadened exposure to the host society, they also 
experience a different kind of inequality and discrimination, similar to the “glass ceiling”. As demonstrated 
earlier in the report made by the Committee of 100, despite the successes of many AAPIs, they are still 
severely under-represented in the most important top tiers of the American business and academia. 

Having become aware of these challenges, U.S.-raised AAPIs have tried to address many of these solidarity 
problems by developing professional organizations, such as the Organization of Chinese Americans, 
Committee of 100, National Association of Asian American Professionals, and Asian Women in Business 
in New York City. These organizations do more than give a voice for the mainstream or attempt to 
mainstream professional AAPIs. These organizations were formed with a primary goal of empowering 
Asian American professionals through peer support and leadership development, increasing awareness of 
the “glass ceiling” and other discriminatory practices, and promoting civic responsibility among AAPIs. It 
is important to note that only a few major American corporations have invested in supporting these types of 
organizations as part of their talent retention and recruitment strategy. 

Leadership 

As discussed several times in this report, leadership and leadership development are important to AAPI 
economic and social success in America. Yet, there are several cultural challenges to empowering and 
developing leadership in the AAPI community, including the following: 

• Isolation of many AAPIs in ethnic enclaves shields them from finding it necessary or worthwhile to 
seek leadership positions or recognition in mainstream America. 




President's Advisory Commission on Asian American and Pacific Islanders 


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• Culturally, AAPIs may generally tend to be more passive and look down upon attempts to 
aggressively seek out positions of visibility or leadership. Many parents directly advise their 
children that it is not appropriate to seek distinction or visible leadership positions. 

• Due to negative experiences in their home countries, many AAPI groups are fearful or distrustful of 
government. Therefore, they will attempt to “hide’* from government and will not seek out 
assistance for fear that it may come with restrictions or unwanted requirements and obligations. 

They may also avoid attempts to collect data about them and their needs. Voter registration and 
providing census information are examples of areas in which certain AAPIs groups have avoided 
participating because of past fears and experiences with their home governments. In 2004. bringing 
Asian American registration rates to those of whites would have added almost 700,000 voters. 9 ' 

Visible AAPI leaders have and are emerging, but there are still too few, given the AAPI community’s size 
and economic impact. To get beyond these cultural challenges to leadership development, it may be most 
useful to focus on youth, so that the cultural biases of one generation do not hinder the opportunities of 
following generations. AAPI youth also appear to greatly benefit from exposure to AAPI role models, 
different opportunities, and support systems that demonstrate understanding of their unique cultural 
viewpoints and challenges. 

Ongoing Immigration Leads to Continuous Challenges 

Ongoing immigration of new waves of different AAPI groups from different countries, with different 
languages, and different cultures will continue to complicate efforts to understand and serve the AAPI 
community. This challenge will continue to frustrate and limit the effectiveness of many programs that 
target this community. It will also continue to exacerbate current problems, such as the fragmented nature 
and limited capacity of many AAPI-serving CBOs and FBOs. 

Too often, the diversity of the AAPI community' has presented to governments, corporations, and similar 
bodies a convenient excuse that it is too difficult to successfully help this group. However, the current and 
future challenges of helping this community' should not be a deterrent, particularly because it is these very 
immigrant groups that have the economic potential to not only benefit the U.S., but also to develop and 
invigorate the communities that new immigrants will turn to in the future. 9t 

Invisible minority Dilemma 

The Model Minority Myth not only hides the problems that AAPIs face; it obscures AAPIs from even being 
recognized as a minority' group. Too often, the success of the AAPI community has generated a perception 
that this community does not need help, or at least not as much help as do other minority groups. 

While federal, state, and local programs target minority entrepreneurs, few' appear to focus on reaching out 
to AAPIs. This is apparent in the fact that AAPIs are the lowest recipients of government programs and 
assistance. The U.S. Department of Commerce Minority Business Development Agency (MBDA) reported 
that minority-owned firms were awarded $1.5 billion in procurement and financial contracts through 
MBDA’s network of funded centers in fiscal year 2005. MBDA’s centers included Minority- Business 
Enterprise Centers, Native American Business Enterprise Centers, and Minority Business Opportunity' 
Centers located across the nation. Despite the number and growth in the number of AAPI-owned 
businesses. MBDA reported in fiscal year 2005 that of the $1.5 billion in contracts and financing obtained 
by minority groups through MBDA, AAPIs received fewer contracts or financings (in dollar amount) than 
Hispanic, American Indian and Alaska Native, or African American minority' groups. AAPI-owned firms 
received four times fewer dollars and fewer than half of the number of financing dollars as did Hispanic- 


95 Passel. Jeffrey S. Latino and Asian Voters in the 2004 Election and Beyond. Migration Information Source. November 2004. 

96 State of Asian Businesses. MBDA Minority Business Profile 2006. 





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owned, American Indian and Alaska Native-owned, and African American-owned firms. 97 (See Figures 6 
and 7.) Of the $1.5 billion in contracts and financings facilitated, about $134 million were awarded to 
AAPI-owned firms (8.7 percent), $478 million were awarded to African American-owned firms (31 
percent), $528 million were awarded to Hispanic-owned firms (34 percent), $354 million were awarded to 
Native American/Alaska Native-owned firms (22 percent). 

Further research is necessary to determine if the level of services and contracts provided to AAPI-owned 
firms by the federal government and other agencies that serve minority-owned firms, such as the Small 
Business Administration, is proportional to the representation of the AAPI community in the United States, 
and compared to the services 98 provided to other minority groups. 


Figure 6. Value of Contracts obtained by Minority firms through 
MBDA, FY 2005 (data from MinorityBiz Fast Facts 2006) 



African American American Indian & AAPI Hispanic All Minority 

Alaska Native 


Figure 7. Value of Financings Obtained by Minority Firms through 
MBDA, FY 2005 (data from MinorityBiz Fast Facts 2006 ) 



Alaska Native 


97 MinorityBiz Fast Facts 2006, U.S. Department of Commerce Minority Business Development Agency 
<http://www.mbrt.net/AmericanIndianandAlaskaNativeProfile.pdf> ; and <http://mbrt.net/AsianMBEProfile.pdf>. 

98 Annual Performance Report Fiscal Year 2005, U.S. Department of Commerce Minority Business Development Agency. 





































President's Advisory Commission on Asian American and Pacific islanders 


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The Small Business Administration, corporations, and institutions have also dedicated more programming 
and effort towards addressing the needs and development of the Hispanic or African communities. 

Some strides are being made in this area for AAPI communities. The U.S. Department of Labor, for 
example, has instituted several programs directly targeting AAPI workers, businesses, and entrepreneurs. 
Additionally, the Department has translated guides, held AAPI-specific conferences, and published new 
data on AAPIs. The Commission, however, believes that the government can do much more. 

INSUFFICIENT ECONOMIC DATA COLLECTION 

There is considerable need for data collection to understand the differences across the AAPI subgroups and 
the lack of data about the AAPI entrepreneur on characteristics such as demographics of the entrepreneur, 
the entrepreneur's background, and differences across the generations of the AAPI communities. The 
Commission feels that the collection of such data is critical to making better informed decisions for the 
AAPI communin’. Not only does this data collection have to begin, but these demographics have to be 
tracked over time so that the impact of the federal interventions can be evaluated. 

Lack of Subgroup Data 

The Model Minority Myth is largely a consequence of the lack of disaggregated data on AAPIs. In 
developing this report, the Commission was often frustrated by the lack of data available, especially 
economic data and research specifically about different AAPI groups. Analyzing policies and programs 
without considering the diversity of AAPIs obscures the economic and social problems that we know 
continue to remain pervasive. 

Challenges faced by AAPIs and AAPI entrepreneurs are often invisible to mainstream America because 
they are obscured by the skew ed data that is currently available on the success of some in the AAPI 
community. Economic data disaggregated by subgroups is a vital tool for AAPI communities and federal, 
state, and local governments, but few government entities have taken the steps necessary to inquire deep 
enough to capture the economic information needed on the AAPI community to truly understand its needs. 

To shed some light on the differences amongst AAPI groups, the 2000 Census, for the first time, classified 
Native Hawaiians and Pacific Islanders in their own category, separate from Asian Americans. But this 
effort, alone, is not enough and still does not go far enough to indicate specific information about where 
needs are greatest or how these issues can be addressed. 

Without sufficient data, it is not only difficult to recognize existing problems, but it is impossible to 
adequately address them. The effective allocation of resources and programs and the ability to measure the 
impact of any program is dependent on having a foundation of data to begin with that can be tracked and 
measured. For the AAPI community, much of this critical economic development data is not being 
captured, and this has become a great impediment to the community's ability’ to access resources, support, 
and programming. 

Some possible measures that could be considered for further data collection on the AAPI community are 
sender, age, generation in the U.S.. education, income level, employment status, marital status, size of 
household, ethnicity, language, nativity, location of businesses, risk-taking propensities, and entrepreneurial 
missions. Similar measures have been used in several entrepreneurship studies in the past." 

Absence of Data about the AAPI Entrepreneur 

The issues and problems of the AAPI community must be recognized and addressed if the economic 
contributions and progress of AAPIs are to be maximized. To begin identifying the real problems and 


99 Ewine Marion Kaufman Foundation: The New Agenda for Minority Business Development. 2005. 




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solutions, it is imperative that more substantial efforts are made to collect disaggregated economic data on 
the AAPI community. This needs to start with actions taken by federal government. 

Regardless of the challenges in reaching and capturing the diversity of the AAPI community, the 
Commission knows that this data can be collected. During the Commission’s work, many fine community 
efforts were identified that are successfully mining existing data and tracking new data for the type of 
detailed information that will aid policymakers. A few examples include: 

• The Diverse Face of Asians and Pacific Islanders in California , l0u released in 2005, is a detailed 
demographic profile of the one-third of the nation’s AAPIs who live in California, detailing the rich 
diversity of the many ethnic groups, cultures, and languages represented in the state. 

This work conducted by the Asian Pacific American Legal Center (APALC), with the sponsorship 
of the National Asian Pacific American Legal Consortium and the Asian Law Caucus, is a rich 
resource for anyone seeking to understand the economic diversity represented in the state and in 
Southern California, the Bay Area, and the Central Valley regions. Data on population, income, 
poverty, language proficiency, health insurance coverage, homeownership, and education are 
included, often down to the Census place level. 

• The Asian Pacific American Community Development Data Center (a project of National 
CAPACD, the UCLA Asian American Studies Center and the U.S. Census Bureau Census 
Information Program) has produced state fact sheets mined from the 1990 and 2000 Census data. 
Tabulated at the state level, the fact sheets utilize the Asian American data, as well as the Native 
Hawaiian Pacific Islander data, to portray the diversity of the AAPI populations in, for example, 
California, Florida, Hawaii, Illinois, Massachusetts, Minnesota, and Washington. 101 

• The group Advocacy for North Carolina Asian Pacific Americans (ANCAPA) produces several fact 
sheets for North Carolina on population characteristics and data by county. North Carolina (among 
states like Nevada and Georgia) has recently seen its AAPI population grow rapidly, and the state is 
facing new challenges in tailoring services to meet the rapidly growing needs of these residents. 

The ANCAPA fact sheet gives information on the location of the population growth and some 

1 09 

characteristics, such as limited English proficiency. 

• Economic Needs of Asian Americans and Pacific Islanders in Distressed Areas: Establishing 

Baseline Information , produced in 2002 by Paul Ong and Doug Miller, is a study from UCLA in 
collaboration with National CAPACD that was funded by the Economic Development 
Administration of the U.S. Department of Commerce. It provides useful data, down to the Census 
tract level for selected economically-distressed areas, often termed “ethnic enclaves.” 

Unfortunately, too few of these efforts are under way and even fewer are focusing on economic 
development issues. A good investment in the effort to increase economic and community development of 
the AAPI community would be an investment in truly understanding the community and its needs in the 
area of economic development and entrepreneurship characteristics. This effort would not only help to 
identify needs; it would also help us to better understand and measure the best approach to addressing these 
needs and, therefore, allow us to unlock the enormous potential of the AAPI community. 


100 The Diverse Face of Asians and Pacific Islanders in California: Asian & Pacific Islander Profile, Asian Pacific American Legal 
Center, 2005. 

101 California (and other states): A Profile of the Asian American and Native Hawaiian/Pacific Islander Population, Asian Pacific 
American Community Development Data Center, 2004. 

102 Fact Sheet: The Asian Pacific American Population in North Carolina, ANCAPA. 







President's Advisory Commission on Asian American and Pacific Islanders 


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The Commission appreciates the contributions and tireless efforts of the many individuals and organizations 
it met with. Not only did their insights provide invaluable guidance for this report, but their involvement in 
the communities in support of AAPIs across the United States and its Territories is applauded. 



President's Advisory Commission on Asian American and Pacific Islanders 


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FINDINGS AND RECOMMENDATIONS 


The Commission commends the President for charging this Commission to focus work on the economic 
development issues of the AAPI community. This is not only a critical area for the long-term health of 
AAPI communities and our nation, but it is also an area that has largely been overlooked. The Commission 
hopes that the information, research, and anecdotes gathered in this report can serve as a launching point for 
ongoing data collection and detailed analyses on economic and community development issues of the AAPI 
community. The Commission feels that the entrepreneurial potential and resulting economic participation 
of the AAPI community can be further enhanced if these recommendations are executed. The Commission 
has organized its findings and recommendations on issues in two categories: (1) primary recommendations 
and (2) secondary recommendations. 

Primary Recommendations 

Issue 1: Data about AAPI-Owned Businesses and Community 

Finding: AAPIs are a very diverse group in the U.S., consisting of 50 ethnic 
different languages. ' The Commission assessed relevant data published 
by U.S. government sources and conducted site visits to AAPI 
communities across the U.S. mainland and Pacific Islands. The 
Commission noted that there is insufficient data on AAPI entrepreneurs 
that includes, but is not limited to, the disaggregated data on various AAPI 
subgroups, characteristics of AAPI entrepreneurs, and the impact of the 
federal, state and local assistance interventions on AAPI-owned 
businesses. Without such detailed information on the economic and 
entrepreneurial characteristics of AAPIs, beyond the data complied every five years by U.S. Census Bureau 
in its Survey of Business Owners, it is difficult to recognize the problems that exist within the AAPI 
business communities and develop strategies to address them. 

The Commission greatly appreciates the efforts undertaken by some community-based organizations, 
foundations, and institutions of higher education to take on some of this work. This research, however, is 
limited to locations with high concentrations of AAPI communities and, therefore, cannot be generalized to 
the broader AAPI community. 

Recommendation: 

• The White House should form a task force to determine what data should be collected to better assist 
federal agencies that focus on business development and assistance programs in prioritizing and 
implementing initiatives to help AAPI entrepreneurs. Additionally, research grants and other funding 
should be made available for research and data collection about AAPI economic and community 
development. 

Issue 2: Nature of AAPI-Owned Businesses and Existing Targeted Support 

Finding: The Commission has noted a key factor that has limited the economic potential of AAPIs: a 
significant number of these businesses are in the “no-growth” or “slow-growth” sectors. For example, 
according to U.S. Census Bureau in its 2002 Survey of Business Owners, retail and wholesale trade 


subgroups that speak 100 


There is a serious 
need for data 
collection on the 
economic activities 
of AAPIs. 


103 


President’s Advisory Commission on Asian Americans and Pacific Islanders, A People Looking Forward: Action for Access and 
Partnerships in the 21st Century, Interim Report to the President and the Nation, (Jan. 2001), p.7, 
<http://www.nationalcapacd.org/pdf/data_policy.pdf>. 






President's Advisory Commission on Asian American and Pacific Islanders 


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accounted for 47 percent of Asian-owned business receipts. K)4 Despite the number of AAPI-owned 
businesses and the recent growth of that percentage, the Department of Commerce Minority Business 
Development Agency (MBDA) reported that in fiscal year 2005, out of $1.5 billion in contracts and 
financing obtained by minority groups, AAPIs received fewer contracts or financings than the Hispanic, 
American Indian and Alaska Native, or African American minority groups. AAPIs received four times 
fewer contracts and fewer than half of the financings as did Hispanic-owned, American Indian and Alaska 
Native-owned, or African American-owned firms. Asian-owned firms also had a high concentration in 
"other services,” such as personal services, repair and maintenance services, and professional, scientific, 
and technical services. Native Hawaiian and Other Pacific Islander-owned businesses appear to be 
concentrated in health care and social assistance services, “other” services, retail, waste management 
services, and construction (see Table 7). 

The Commission observes that many of these AAPI-owned businesses cannot go beyond the subsistence 
level of operation if their owners are not provided the access to information on opportunities, tools, and 
motivation to become Opportunistic Entrepreneurs (OEs). An infrastructure of medium- and large-sized 
companies that create jobs, technological advances, and world-class products and services is needed to 
grow the U.S. economy. The Commission believes that the creation and development of OEs within the 
AAPI community- will increase the probability that AAPI-owned businesses will grow' beyond current 
levels. 

Recommendation: 

• Government agencies (federal, state, and local) need to increase outreach efforts of existing programs 
that are currently available to other minorities to AAPIs. Some of these programs may also need to be 
designed with an AAPI-specific focus, including outreach, language assistance, and other culturallv- 
aware counseling, to ensure that AAPIs are able to access these programs and succeed in obtaining a 
“fair share” of available benefits. 

• In situations in which AAPI-specific programs do not exist, government agencies need to create and/or 
tailor outreach and support efforts to increase AAPI access to these assistance programs. The 
establishment of a National Registry- of CBOs and FBOs housed at a federal agency such as Department 
of Health and Human Services (HHS) w ill enhance AAPI access to assistance w hen needed. 

Issue 3: Measuring and Tracking the Effectiveness of Federal Interventions 

Finding: Although the U.S. Department of Commerce Minority- Business Development Agency (MBDA) 
has gathered data on the contracts aw-arded by various minority- groups that they serve, insufficient data is 
available at other federal agencies. Further research is necessary- to determine the level of services and 
contracts that are currently provided to AAPI-ow-ned firms by federal agencies. Additionally, there is little 
information available relative to the level of contracts aw arded to the AAPI business community- in an 
aggregate form or by subgroups within the community. In order to measure the effectiveness of availed 
opportunities by AAPI entrepreneurs and to identify areas of improvement, detailed information from 
federal agencies is crucial. 

Recommendation: 

• Establish a Strategic Working Group of representatives from key federal agencies to coordinate and 
implement recommendations related to AAPI-owned business growth. Currently, there is no 
oversight of AAPI-based economic initiatives. Some agencies, such as the Department of 
Commerce, the Small Business Administration, the Department of Treasury, the General Services 
Administration, the Social Security Administration, the Department of Transportation, and the 


104 U.S. Census Bureau News, Revenues for Asian-Owned Firms Surpass $326 Billion: Number of Busmesses Up 24 Percent, May 
16,2006, U.S. Census Bureau, < http://www.cCTSus.gov/Press- 

release/www/releases/archives/business_ownership/006814 htm 1>. 





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Department of Defense, play a key role in creating and supporting programs that foster AAPI 
entrepreneurship and should be part of the Strategic Working Group. The mandate of this group 
should be to outline and implement initiatives to increase outreach, data collection and research on 
AAPI-owned businesses. The Commission also recommends that this Working Group conduct 
additional research on barriers that AAPIs face in attempting to work with the federal government 
and implement initiatives to improve outreach and support. 

• Establish a task force to initiate and implement the recommendations from this and the 2003 AAPI 
Commission on Health and Disparities reports. 105 The Commission believes that it is imperative 
that such a task force will ensure that the work outlined in these reports is managed and addressed 
by the Executive Branch and the legislative bodies of the Congress. 

SECONDARY RECOMMENDATIONS 

In addition to our primary recommendations to the President, the Commission’s findings revealed several 
other important initiatives that may be considered to enhance the economic development of AAPIs. 


1. Build capability to offer counseling and mentoring on entrepreneurship and business 
development issues within community-based organizations 

Although community-based organizations historically have been more focused on securing funding 
for housing, health care, childcare and other social assistance programs, the evidence from 
numerous studies supports encouraging entrepreneurship as a means to generate greater economic 
wealth within the community. Training - through local resources and partnerships (e.g., SCORE) 
can pay huge dividends in helping AAPIs not only reach subsistence levels but also to encourage 
and develop more Opportunistic Entrepreneurs. 

2. Foster greater collaboration among various AAPI-oriented organizations 

Given the scarce and declining resources available to qualified community-based and faith-based 
organizations, successful communities have found ways to effectively collaborate across 
organizations to secure funding, build critical mass for larger-scale projects, and provide more 
extensive training and support around entrepreneurship and business development. Currently, there 
is no forum to share these success stories. We recommend that a key component of the Strategic 
Working Group of key federal agencies established above be to coordinate the development of 
programs that foster greater collaboration among the various AAPI organizations that are currently 
serving their respective communities. 

3. Encourage the establishment of a National Asian American and Pacific Islander Chamber of 
Commerce 

A national chamber will foster interaction, sharing of experiences and contacts, and highlight the 
increasing economic relevance of various regions in global trade and business. Accordingly, we 
recommend the establishment of a National Chamber of Commerce for AAPIs. 


105 


Asian Americans and Pacific Islanders Addressing Health Disparities - Opportunities For Building A Healthier America, 2003, 
<http://www.health.gov/comnmnication/db/report_detail.asp7n> 160&page=9&search_type=all&sp=6>. 




President's Advisory Commission on Asian American and Pacific Islanders 


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Appendix A. Executive Order 13339 



Monday. 

May 1", 200-4 



Pan V 


The President 


Executive Order 1 >$39—Increasing 
Economic Opportunity and Business 
Participation of Asian Americans and 
Pacific Islanders 
















President’s Advisory Commission on Asian American and Pacific Islanders 


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INCREASING ECONOMIC OPPORTUNITY AND BUSINESS PARTICIPATION OF ASIAN 
AMERICANS AND PACIFIC ISLANDERS 

By the authority vested in me as President by the Constitution and the laws of the United States of America, 
and for the purpose of providing equal economic opportunities for full participation of Asian American and 
Pacific Islander businesses in our free market economy where they may be underserved and thus improving 
the quality of life for Asian Americans and Pacific Islanders, it is hereby ordered as follows: 

Section 1. (a) There is established in the Department of Commerce the President's Advisory Commission on 
Asian Americans and Pacific Islanders (Commission). The Commission shall consist of not more than 15 
members appointed by the President, one of whom shall be designated by the President as Chair. The 
Commission shall include members who: (i) have a history of involvement with the Asian American and 
Pacific Islander communities; (ii) are from the business enterprise sector; (iii) are from civic associations 
representing one or more of the diverse Asian American and Pacific Islander communities; (iv) are from the 
fields of economic, social, and community development; or (v) have such other experience as the President 
deems appropriate. 

(b) The Secretary of Commerce (Secretary) shall designate an Executive Director for the Commission. 

Sec. 2. The Commission shall provide advice to the President, through the Secretary, on: (a) the 
development, monitoring, and coordination of executive branch efforts to improve the economic and 
community development of Asian American and Pacific Islander businesses through ensuring equal 
opportunity to participate in Federal programs, and public-sector, private-sector partnerships, and through 
the collection of data related to Asian American and Pacific Islander businesses; and 

(b) ways to increase the business diversification of Asian Americans and Pacific Islanders, including ways 
to foster research and data on Asian American and Pacific Islander businesses including their level of 
participation in the national economy and their economic and community development. 

Sec. 3. (a) The Secretary shall establish within the Department of Commerce an office known as the White 
House Initiative on Asian Americans and Pacific Islanders (Office). The Office shall provide support for the 
Commission and the interagency working group created in section 3(b) of this order. 

(b) The Secretary shall also create an interagency working group (Working Group) whose activities shall be 
coordinated by the Department of Commerce. The Secretary shall designate the executive departments and 
agencies that shall serve on the Working Group (executive departments and agencies) and the heads of 
those departments and agencies shall select the officials that shall serve as their respective representatives 
on the Working Group. The Executive Director of the Commission shall also serve as the Director of the 
Office and the Working Group, and shall report to the Secretary or the Secretary's designee. The Director of 
the Working Group shall advise the Secretary or the Secretary's designee on efforts by the Federal 
Government to improve access to economic opportunities, through equal access to such opportunities, for 
Asian American and Pacific Islander businesses where they may be underserved and thus to improve the 
quality of life of Asian Americans and Pacific Islanders. 

Sec. 4. The head of each executive department and agency on the Working Group shall designate a senior 
Federal official responsible for management or program administration to report directly to the agency head 
on activities implementing this order and to serve as a liaison to, and representative on, the Working Group. 
The Secretary may designate additional Federal officials, with the concurrence of the head of the designated 
executive department or agency, to carry out functions of the Working Group. To the extent permitted by 
law and to the extent practicable, each designated executive department and agency shall provide 
appropriate information requested by the Working Group, including data relating to the eligibility for and 




President s Advisory Commission on Asian American and Pacific Islanders 


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participation of Asian American and Pacific Islander businesses in Federal programs. Where adequate data 
are not available, the Working Group shall suggest the means of collecting such data. 

Sec. 5. Each designated executive department and agency shall prepare a plan for, and shall document, its 
efforts to support economic opportunities for Asian American and Pacific Islander businesses. This plan 
shall address, among other things, executive branch efforts to: 

(a) increase participation in Federal programs for Asian American and Pacific Islander businesses through 
equal access to such programs; 

(b) ensure nondiscrimination in Federal contracts and procurement opportunities; 

(c) provide equal opportunity for public-sector, private-sector partnerships for the community and economic 
development of Asian American and Pacific Islander businesses; and 

(d) foster research and data collection on Asian American and Pacific Islander businesses. Each plan shall 
be submitted through the working group and the Commission to the Secretary at a date to be established by 
the Secretary. 

Sec. 6. The Secretary shall review the plans of the designated executive departments and agencies and 
develop for submission to the President for his approval an integrated Federal plan (Federal Plan) to 
increase the participation of Asian American and Pacific Islander businesses in executive branch programs 
through equal access to such programs where such organizations may be underserved. Actions described in 
the Federal Plan shall address improving access by Asian American and Pacific Islander businesses to 
Federal programs and fostering advances in relevant research and data as it pertains to community 
economic development. The Secretary shall disseminate the Federal Plan, to the extent the Plan is approved 
by the President, to appropriate members of the executive branch. The findings and recommendations in the 
Federal Plan shall be followed by the designated executive departments and agencies in their policies and 
activities, to the extent permitted by law and as practicable. 

Sec. 7. Insofar as the Federal Advisory Committee Act, as amended (5 U.S.C. App.) (the "Act"), may apply 
to the administration of any portion of this order, any functions of the President under the Act, except that 
of reporting to the Congress, shall be performed by the Secretary in accordance with the guidelines issued 
by the Administrator of General Services. 

Sec. 8. Members of the Commission shall serve without compensation, but shall be allowed travel expenses, 
including per diem in lieu of subsistence, as authorized by law for persons serving intermittently in the 
Government service (5 U.S.C. 5701-5707). To the extent permitted by law and appropriations, and where 
practicable, executive departments and agencies shall, upon request by the Secretary, provide assistance to 
the Commission and to the Working Group, and the Department of Commerce shall provide administrative 
support and funding for the Commission. 

Sec. 9. The Commission shall terminate 2 years from the date of this order, unless renewed by the 
President. 

Sec. 10. For the purposes of this order, the term: (a) "Asian" includes persons having origins in any of the 
original peoples of the Far East, Southeast Asia, or the Indian subcontinent; and the term (b) "Pacific 
Islander" includes persons having origins in any of the original peoples of Hawaii, Guam, Samoa, or other 
Pacific Islands. 



President's Advisory Commission on Asian American and Pacific islanders 


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Sec. 11. The Secretary of Commerce shall consult the Attorney General as appropriate on the 
implementation of this order to ensure that such implementation affords the equal protection of the laws 
required by the due process clause of the Fifth Amendment to the Constitution. 

Sec. 12. This order is not intended to, and does not, create any right or benefit, substantive or procedural, 
enforceable at law or in equity, by a party against the United States, its departments, agencies, entities, 
officers, employees or agents, or any other person. 

GEORGE W. BUSH 


THE WHITE HOUSE, 
May 13,2004. 



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Appendix B. Members of the President’s Advisory Commission on Asian 

American and Pacific Islanders 

Mr. W illiam P. Afeaki of Salt Lake City, Utah, was appointed by the Governor of Utah to serve as the 
Director of the Utah State Office of Pacific Islander Affairs, which is housed in the Utah Department of 
Community and Economic Development. He also served for three years on the Racial Ethnic Advisory 
Council for the Census Bureau at the U.S. Department of Commerce, the last as Vice-Chairman of the 
Native Hawaiian and Other Pacific Islander Committee. Mr. Afeaki was a Member of Parliament in the 
Legislative Assembly of the Kingdom of Tonga. He is an avid supporter of Pacific Islanders and is heavily 
involved with national, regional, and local forums for Pacific Islanders. Mr. Afeaki currently serves as a 
member of the Pacific Islander Cancer Control Netw ork, the National Pacific Islander Council of Leaders, 
and the Association of Asian Pacific Community Health Organizations. He also serves on many public 
boards including the Coalition for Utah Families Advisory Board, the Utah Ethnic Health Advisory 
Committee, the Utah State Advisory Council on Aging and Adult Serv ices, and the Utah Substance Abuse 
and Anti-violence Coordinating Council. 

Ms. Nina Nguyen Collier of Issaquah, Washington, is a founding partner of Washington 2 Advocates, a 
government affairs, strategic planning, and communications consulting firm located in Washington State 
and Washington, DC. Prior to founding Washington' Advocates, Nina worked for Senator Slade Gorton as 
the lead Legislative Assistant in the areas of federal budget, tax, general government, appropriations, and 
Indian Affairs. She also served in local government as a Legislative Analyst to the King County Council 
Budget Committee. Ms. Collier also holds several leadership positions including President of the Board of 
Governors of the City Club of Seattle, Board member of the Gorton Legacy Group. Board member of the 
National Asian Pacific Center on Aging, and a volunteer advisor to the Bellevue YMCA Youth and 
Government Program. Nina and her family immigrated to the United States from Vietnam in 1975 and 
settled in Washington State. She has a Masters Degree in International Affairs from George Washington 
University' and a Bachelor's Degree in International Studies from the University of Washington. 

Dr. Akshay Desai, of St. Petersburg, Florida, is a leading private practice physician and founder of 
American Family and Geriatric Care in St. Petersburg, Florida, as well as the CEO and President of 
Universal Health Care, a managed care organization. Dr. Desai currently holds several leadership positions 
including Elected Chairman of the Council for Education Policy and Research Improvement. Previously, 

Dr. Desai has served as Chief of Staff and Chairman of the Board of Trustees at Northside Hospital and 
Heart Institute and St. Petersburg General Hospital. He has served on numerous committees of various 
hospitals and health plans throughout the Tampa Bay area. He also w as a member of the Post Secondary' 
Education Planning Commission for the State of Florida. Dr. Desai received recognition as Co-Chairman 
for organizing a successful annual convention in 2003 for the American Association of Physicians of Indian 
Origin in Orlando. Dr. Desai is certified by the American Board of Internal Medicine, Geriatrics and 
Quality Assurance, and is affiliated with the American Medical Association, Florida Medical Association, 
Pinellas County Medical Society, and American College of Physician Executives. Dr. Desai received his 
medical degree from Government Medical College in Surat, India and his Masters Degree in Administrative 
Medicine from George Washington University. 

Mrs. Vellie Dietrich-Hall, of Springfield. Virginia, is the Chief Executive Officer and President of HPS 
Enterprises, Inc., a management-consulting service company dedicated to filling in the “expert vacuum’* 
within the Department of Defense (DoD) arena with the highest technical capabilities among former federal 
and military personnel. Mrs. Hall w'as honored as keynote speaker at U.S. military bases during the 2001 
Asian American Heritage celebration because she is one of the very few female Filipino Asian-Americans 
within the DoD that succeeded in penetrating the male-dominated workforce. Mrs. Hall is the first Asian 
American Trustee of Randolph-Macon Woman’s College since its inception in 1857 and Chairman of its 
Family Advisory Council. Mrs. Hall is a member of the Board of Directors of Horizons Theater (where she 
was the first Asian and only Filipino member), a member of the Board of Directors of QBD Ink, a Filipino- 




President's Advisory Commission on Asian American and Pacific Islanders 


Page 52 


American Theater, and a District Officer of Toastmasters International. She is also the publisher of the 
Filipino HERALD of Virginia. Mrs. Hall received a Liberal Arts Degree from the University of the 
Philippines. She also received her Acquisition Career and Program Management accreditation from the 
Department of Defense Systems Management College. 

Mr. William Kil, of Los Angeles, California, is a private practice attorney in Los Angeles, California 
specializing in corporate, real estate, business, and immigration law. He is also the president of EOSolve, 
LLC, which provides online workplace training in a variety of areas to management and employees of 
companies in English, Spanish, Korean and Chinese. Mr. Kil is an active member of the community serving 
in numerous organizations, including member and former Vice-President of the Board of Directors of the 
Korean-American Chamber of Commerce of Los Angeles; former Commissioner of the Productivity 
Commission of the City of Los Angeles and former member of the Joint Venture Advisory Board of the 
State of California (which oversees private business operations inside state prisons); Chairman of the Board 
of Directors of the Foundation for SAT II KOREAN; Member of the Advisory Council on the Democratic 
and Peaceful Unification of Korea; and former member of the Los Angeles World Airports Business 
Council. Mr. Kil received his Juris Doctor from the University of Colorado School of Law, and a Bachelor 
of Arts in Economics from Pomona College. He is a member of both the California and Colorado State 
Bars. 

Mr. John C. Kim, of Los Angeles, California, is Senior Director of Product Marketing with Yahoo! Inc. In 
his current role, Mr. Kim is responsible for understanding customer needs to define product, pricing, 
positioning and programs to capture growth, leadership and advertising industry share. Previously, Mr. Kim 
worked as a general management consultant with Accenture, a global management consulting and 
technology service's company. Prior to that, he held various marketing and product positions with Bank of 
America and Household International, Inc. Mr. Kim volunteers his time with many community 
organizations including the Grandview Foundation and the Pasadena Cold Weather Shelter. Mr. Kim 
received a Masters of Business Administration from the University of Chicago, and a Bachelor of Arts in 
Economics from the University of California, Santa Barbara. 

Mr. Howard Li is the founder. Chairman & CEO of Waitex International Co., Ltd. / Prime Time 
International, Inc. and Fortune USA, Inc., which began operations in 1981 in New York City. Mr. Li also is 
the founder and sole owner of a conglomerate of multinational companies involving logistics, information 
technology, real estate development, global trading and retail stores. Crain’s Magazine has ranked Waitex 
Group of Companies as one of the top 200 privately held companies in years 2002-2005 in the greater New 
York Area. Prime Time International, Inc. and Fortune USA Inc. manufactures, imports, and wholesales 
men’s and women’s apparel to major department and specialty stores across the United States under its own 
10 famous national brands, such as Focus 2000 and Focus Lifestyle, as well as under licenses, such as brand 
Russell Athletic (special sizes). In 2005, Howard Li served as Chairman of the National Minority 
Enterprises Development (MED) Week 2005 Conference, supported by the US Department of Commerce 
and served as Co-Chairman from 2002 to 2004. In addition, he is director of the United Way of New York 
City, one of the largest volunteer-directed organizations, and is chairman of the US-Chinese Chamber of 
Commerce. He was the first Asian American in twenty-three years to lead the National Minority Enterprises 
Development (MED) Week 2005 Conference Steering Committee. He was chosen as an illustrious 
recipient of the Ellis Island Medal of Honor Award for 2001, Ernst & Young Entrepreneur of the Year 
Award Finalist of New York City and New Jersey. Mr. Li also received the Pioneer Award, presented by 
US Department of Commerce’s Minority Business Development Agency. 

Mr. Joseph Melookaran, of Overland Park, Kansas, is a Certified Public Accountant and President of 
JMA Chartered, an accounting and information technology firm. Mr. Melookaran began his career in 
Bombay, India with Coopers and Lybrand International representing firm before immigrating to the United 
States in 1983. Mr. Melookaran held several leadership positions in community organizations including 
Chairman of the Asian American Chamber of Commerce of Kansas City and President of the International 
Relations Council, the premier World Affairs Council organization in the Midwest. He serves as a member 




President s Advisory 1 Commission on Asian American and Pacific Islanders 


Page 53 


of the Executive Committee of the Minority Business Advisory Program of Greater Kansas City Chamber 
of Commerce. His firm has received numerous awards including the "2004 Top Ten Small Business" from 
the Greater Kansas City - Chamber of Commerce, the "2006 Minority Small Business Champion of the 
Year" from Kansas City District of U.S. Small Business Administration. "2007 Top 25 Minority Owned 
Business" ranked by the Kansas Citv Star newspaper and "2006 Top 25 Accounting Firms" from the Kansas 
City' Business Journal. Mr. Melookaran received a Bachelor of Arts in Business from Kerala University, 
India. 

Mr. Derrick Nguyen, of Fountain Valley, California, is a private practice attorney in California, 
specializing in international business law and civil litigation. He is General Counsel for US Asian Business 
Council, a public policy organization committed to advocating for the advancement of Asian Pacific 
American entrepreneurs and businesses in the United States and abroad, and for Mac Beam. Inc., an 
international group specializing in the research, development and marketing of high-tech medical 
equipments. He serv es a board member of many non-profit organizations, such as Hung Vuong Heritage 
Foundation. Vietnamese Traditional Arts Development Organization, and Yellow Cross. He is the current 
President of the Vietnamese American Bar Association in Southern California, a member of the Steering 
Committee for the National Vietnamese American Bar Association, and a founding member of the National 
Conference of Vietnamese American Attorneys. He acts as a volunteer lawyer for the Asian Pacific 
American Fegal Center and as a legal advisor to many community - associations, such as the Asian American 
Seniors Association. Overseas Vietnamese Artists Mutual Association, Vietnamese National Police 
Friendship Association, and Vietnamese Rangers Alumni Association. In 2005, he was named among “30 
Vietnamese Americans to Watch" by the Orange County Register, and recognized as one of the most 
influential Vietnamese Americans by Viet Tide Newspaper. Mr. Nguyen received his Juris Doctor from the 
University - of Southern California and a Bachelor of Arts in English from the University - of California at Eos 
Angeles. 

Mr. Rudv Pamintuan, Chairman of the President's Advisory 7 Commission on Asian American and Pacific 
Islanders, is a Senior Consultant at Sherman Consulting, an international firm based in Chicago, Illinois. He 
is also the Managing Director for the firm's equity portfolio. Pamintuan serves as Chairman of the Asian 
American and Pacific Islanders Feadership Council board and as advisory - board Chair for the US Asian 
Business Council. Additionally, Pamintuan serves on the Board of the National Center for Community 7 
Development. He is an active member of the Executive’s Club of Chicago and the Chicago Council on 
Global Affairs. 

Mrs. Martha Cruz Ruth, of Agana Heights, Guam, is a native Chamorro and has lived in the Western 
Pacific Island territory - her entire life. She is currently a consultant specializing in media affairs and 
marketing in the travel industry. Her varied interests have taken her into different areas of public service 
and the private sector. She was business editor of a Gannett-oyvned daily newspaper and also editor of its 
monthly supplement, Territorial Progress, which devoted coverage to business and economic development 
throughout Micronesia. Mrs. Ruth entered politics in 1987 when she was elected a senator in at-large 
elections to Guam's legislature. She served three consecutive terms. The Micronesia Society of Professional 
Journalists presented her yvith its "Sunshine Award" for her efforts promoting open government. Other 
positions she has held are Member of the Board of Directors of the Guam Chamber of Commerce, the 
KPRG Guam public radio Board of Trustees, and the Guam Public Museum and Fibrary Board of Trustees. 
Ms. Ruth attended the University of Guam. 

Mr. Jeffrey B. Sakaguchi, of Manhattan Beach, California, is President and Chief Operating Officer of 
Evolution Robotics Retail. Inc., an early-stage company that develops products based on robotic object 
recognition technology for the retail industry 7 . He was formerly a Partner yvith Accenture, a leading global 
management and infonnation technology consulting firm. His expertise includes business and organization 
strategy 7 , operations, innovation, and mergers and acquisitions. He led the firm s Strategy practice in the 
Energy - industry - for North America, and also led the firm's Natural Resources and Strategy practices in 
Southern California. Prior to Accenture, he was a Senior Manager with McKinsey & Company, a 





President's Advisory Commission on Asian American and Pacific islanders 


Page 5-4 


prominent management consulting firm, and was an engineering manager with Chevron USA. For each 
company he has worked. Mr. Sakaguchi has been responsible for minority recruiting and diversity. At 
Accenture, he also was a member of the U.S. Diversity Council, was a Partner representative to the Asian 
American Networking Group, and served as a "Minority Mentor Partner." Mr. Sakaguchi is also currently 
on the Board of Directors for the Greater Los Angeles chapter of the American Red Cross. Mr. Sakaguchi 
received a Masters in Business Administration from The Wharton School of the University of Pennsylvania, 
and a Bachelor of Science in Chemical Engineering from the Massachusetts Institute of Technology. 

Mr. Kenneth Wong, of Holland. Pennsylvania, is the President of CIG Asia, Ltd, a national insurance 
brokerage firm in Philadelphia and Managing Partner of SmithWong Associates, LLC. Mr. Wong was the 
first Asian American appointed as a member of the Board of Directors for the Greater Philadelphia 
Chamber of Commerce. He is also Chairman of the Philadelphia Hong Kong Trade Association, an 
Executive Board Member of the U.S. Hong Kong Business Association, and an Executive Board Member 
of the Hong Kong Federation. Mr. Wong serves as a board member for the Annenberg Center for the 
Performing Arts at the University of Pennsylvania, the Greater Philadelphia Urban Affairs Coalition, the 
Pearl S. Buck International Foundation, the Philadelphia Sports Congress of the Philadelphia Convention & 
Tourism Bureau, the Welcoming Center for New Pennsylvanians, and Woodrock, Inc., a non-profit youth 
program. Mr. Wong is Treasurer and Executive Board Member of the Philadelphia Multi-Cultural Affairs 
Congress- Philadelphia Convention & Tourism Bureau, Treasurer for the Philadelphia Suns, a non-profit 
youth program, and also serves as Co-Chair of the After School All Stars, a non-profit youth program. Mr. 
Wong is also President of the Philadelphia Dragon Boat Association, and was a member of the United 
States National Dragon Boat Team 2005. Mr. Wong received both a Bachelors of Arts in Sociology and a 
Bachelors of Arts in Political Science from the Pennsylvania State University. He was on the Penn State 
Varsity Fencing Team, and a member of Phi Kappa Sigma Fraternity. 



President s Advisory Commission on Asian American and Pacific Islanders 


Page 55 


Appendix Cl. Population Distribution by Ethnicity Status for Asian Americans 

and Pacific Islanders, one race only (in thousands). 


Ethnic Groups _ 1990 _ 2000 


U.S. TOTAL 

248,710 

281,421 

Chinese 

1,649 

2,432 

Asian Indian 

787 

1,678 

Korean 

797 

1,077 

Vietnamese 

593 

1,123 

Filipino 

1,420 

1,850 

Japanese 

866 

797 

Other Asian 

765 

1,285 

Pacific Islander 

343 

399 


Source: U.S. Census Bureau 


Appendix C2. Sales Per Firm by Ethnicity Group for Asian Americans and 

Pacific Islanders (in thousands) 



1997 

2002 

Asian + Pacific Islander 

$336,196 

$292,213 

Asian-owned 

$338,852 

$296,001 

Chinese 

$404,849 

$367,262 

Asian Indian 

$338,837 

$394,817 

Korean 

$338,837 

$297,810 

Vietnamese 

$95,361 

$105,498 

Filipino 

$131,047 

$113,108 

Other Asian 

$268,332 

$272,403 

Japanese 

$511,364 

$352,353 

Pacific Islander-owned 

$213,648 

$147,817 

White-owned 

NA 

$415,974 

Overall U.S. (including 
publicly held corporations) 

$891,043 

$983,852 


Source: U.S. Census Bureau 























President's Advisory Commission on Asian American and Pacific islanders 


Page 56 


Appendix D. Community Site Visits by the Commission 

1. New York City (NY) 

2. Chicago (IL) 

3. Los Angeles (CA) 

4. Tampa Bay (FL) 

5. Philadelphia (PA) 

6. Las Vegas (NV) 

7. Phoenix (AZ) 

8. Oakland (CA) 

9. Baltimore (MD) 

10. Flushing (NY) 

11. Houston (TX) 

12. Raleigh (NC) 



President s Ad\ isory Commission on Asian American and Pacific islanders 


Page 5 7 


Appendix El. Technical Assistance Workshop Sites 

1. Chicago (IL) 

2. Los Angeles (CA) - Korean-Specific and Vietnamese-Specific 

3. Oakland (CA) 

4. Fairfax (VA) 

5. Raleigh (NC) 

6. Philadelphia (PA) 

7. Seattle (WA) (In collaboration with White House Office of Faith-Based Initiatives) 

8. Minneapolis (MN) (In collaboration with White House Office of Faith-Based Initiatives) 


Appendix E2. Outreach conducted by AAPI Commissioners 

1. Celebration of Asian American and Pacific Islander Women Leaders - Washington DC 

2. SCORE MOU Signing - Kansas City. MO 

3. Pacific Islanders Technical Assistance Conferences - San Francisco, CA 

4. DC Chamber of Commerce Summit - Washington. D.C. 

5. Regional Conference - Chicago, IL 

6. NAPCA and AAPI Commission visits with AAPI Seniors - Los Angeles, CA 

7. Korean Churches for Community Development Conference - Los Angeles, CA 

8. Regional Conference - Houston, TX 

9. Regional Conference - Boston. MA 



President’s Advisory Commission on Asian American and Pacific Islanders 


Page 58 


Appendix F. Chi-Square Statistical Method Elaborated 

Statistical Method Used to show that Asian American and Pacific Islander-Owned Firms are 
Smaller (Have Fewer Employees) than White-Owned Firms, Data from 2002 U.S. census. 

Use Chi-square analysis to check if the distribution of firms by size depends on the ethnicity of the owner. 

Appendix FI. Ownership (Asian or White Owned) and firm size Cross-tabulation 



RESIDUAL= Observed count-Expected count 

Chi-Square value for above table: 5913.683, degrees of freedom=7, p <.000. A statistically significant chi- 
square indicates that there is a relationship between the size of firms and the owners’ ethnicity. A closer 
look at the residuals in the various cross tabulated cells reveals that Asians have more smaller firms than 
predicted by an independence model, while Whites have larger firms than predicted by the same model. 

Appendix F2. Ownership (Native Hawaiian and Pacific Islander(NHPI) or White Owned) and 
firm size Cross-tabulation 



Chi-Square value for above table: 108.860, degrees of freedom=7, p <.000. A statistically significant chi- 
square indicates that there is a relationship between the size of firms and the owners’ ethnicity: NHPI- 
owned firms generally are smaller than white-owned firms. 


































President's Advisory Commission on Asian American and Pacific Islanders 


Page 59 


Appendix G. Calculations Used to Arrive at “Lost” Sales Numbers for 2002 
Calculation for “Lost” Sales and Receipts by AAPI-Owned Firms: 


Based on 2002 Census data for all firms, a simplistic calculation indicates that taking current AAPI-owned 
businesses up to White-owned business performance levels would have delivered $140 billion in additional 
receipts that year. 

To arrive at this number, the following process was used: 

1. Calculate average sales and receipts per White-owned firms 

= (total sales of White-owned firms/number of White-owned firms) 

=8,277,812,000/19,899,839 

=415,974 

2. Calculate average sales and receipts per Asian-owned firm 

=326,663,000/1,103,587 

=296,001 

3. Calculate deficit for each Asian-owned firm 

= (415974-296001) 

=$119,973 

4. Total deficit in sales and receipts for Asian-owned firms 

=Deficit xNumber of Asian-owned firms 

=$119,973x1,103,587 

=$132 billion 

5. Calculate average sales and receipts per Native Hawaiian and Other Pacific Islander-owned firms 

=4,279,000/28,948 

=$147,817 

6. Total deficit in sales and receipts for Native Hawaiian and other Pacific Islander-owned firms 

=$268,157x28,948 
=$8 billion 

7. Total “lost” sales and receipts for AAPI-owned firms 

= (sum of 4 and6 from above) 

=$132 billion + $8 billion 
=$140 billion 



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